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The 
NORTH CAROLINA 

REGISTER 



IN THIS ISSUE 



JUL 5 1990 



EXECUTIVE ORDER 



$> 



PROPOSED RULES 

Environment, Health, and Natural Resources 

Human Resources 

Insurance 

Nursing, Board of 

Secretary of State 

State Personnel 



ARRC OBJECTIONS 



ISSUE DATE: JULY 2, 1990 



Volume 5 • Issue 7 • Pages 474-513 



INFORMATION ABOUT THE NORTH CAROLINA REGISTER AND ADMINISTRATIVE CODE 



NORTH CAROLINA REGISTER 

The North Carolina Register is published bi-monthly 
and contains information relating to agency, executive, 
legislative and judicial actions required bv or affecting 
Chapter 150B of the General Statutes. All proposed, ad- 
ministrative rules and amendments filed under Chapter 
150B must be published in the Register. The Register 
will typically comprise approximately fifty pages per 
issue of legal text. 

State law requires that a copy of each issue be pro- 
vided free of charge to each county in the state and to 
various state officials and institutions. The North Carolina 
Register is available by yearly subscription at a cost of 
one hundred and five dollars ($105.00) for 24 issues. 

Requests for subscriptions to the North Carolina 
Register should be directed to the Office of Ad- 
ministrative Hearings, P. O. Drawer 1 1666, Raleigh, N. 
C. 27604, Attn: Subscriptions. 

ADOPTION, AMENDMENT, AND REPEAL OF 
RULES 

An agency intending to adopt, amend, or repeal a rule 
must first publish notice of the proposed action in the 
North Carolina Register. The notice must include the 
time and place of the public hearing; a statement of how 
public comments may be submitted to the agency either 
at the hearing or otherwise; the text of the proposed 
rule or amendment; a reference to the Statutory 
Authority for the action and the proposed effective date. 

The Director of the Office of Administrative Hearings 
has authority to publish a summary, rather than the 
full text, of any amendment which is considered to be 
too lengthy. In such case, the full text of the rule con- 
taining the proposed amendment will be available for 
public inspection at the Rules Division of the Office of 
Administrative Hearings and at the office of the pro- 
mulgating agencv. 

Unless a specific statute provides otherwise, at least 
30 days must elapse following publication of the pro- 
posal in the North Carolina Register before the agency 
may conduct the required public hearing and take ac- 
tion on the proposed adoption, amendment or repeal. 

When final action is taken, the promulgating agency 
must file any adopted or amended rule for approval by 
the Administrative Rules Review Commission. Upon ap- 
proval of ARRC, the adopted or amended rule must be 
filed with the Office of Administrative Hearings. If it 
differs substantially from the proposed form published 
as part of the public notice, upon request by the agen- 
cy, the adopted version will again be published in the 
North Carolina Register. 

A rule, or amended rule cannot become effective 
earlier than the first day of the second calendar month 
after the adoption is filed with the Office of Ad- 
ministrative Hearings for publication in the NCAC. 

Proposed action on rules may be withdrawn by the 
promulgating agency at any time before final action is 
taken by the agency. 

TEMPORARY RULES 

Under certain conditions of an emergency nature, 
some agencies may issue temporary rules. A temporary 
rule becomes effective when adopted and remains in 



effect for the period specified in the rule or 180 days, 
whichever is less. An agency adopting a temporary rule 
must begin normal rule-making procedures on the per- 
manent rule at the same time the temporary rule is 
adopted. 

NORTH CAROLINA ADMINISTRATIVE CODE 

The North Carolina Administrative Code (NCAC) is 
a compilation and index of the administrative rules of 
25 state agencies and 38 occupational licensing boards. 
The NCAC comprises approximately 15,000 letter size, 
single spaced pages of material of which approximate- 
ly 35% is changed annuallv. Compilation and publica- 
tion of the NCAC is mandated by G.S. 150B-63(b). 

The Code is divided into Titles and Chapters. Each 
state agency is assigned a separate title which is fur- 
ther broken down by chapters. Title 21 is designated 
for occupational licensing boards. 

The NCAC is available in two formats. 

(1) Single pages may be obtained at a minimum 
cost of two dollars and 50 cents ($2.50) for 10 
pages or less, plus fifteen cents ($0. 1 5) per each 
additional page. 

(2) The full publication consists of 52 volumes, 
totaling in excess of 15,000 pages. It is sup- 
plemented monthly with replacement pages. A 
one year subscription to the full publication in- 
cluding supplements can be purchased for 
seven hundred and fifty dollars ($750.00). In- 
dividual volumes may also be purchased with 
supplement service. Renewal subscriptions for 
supplements to the initial publication available. 

Requests for pages of rules or volumes of the NCAC 
should be directed to the Office of Administrative 
Hearings. 

NOTE 

The foregoing is a generalized statement of the pro- 
cedures to be followed. For specific statutory language, 
it is suggested that Articles 2 and 5 of Chapter 150B of 
the General Statutes be examined carefully. 

CITATION TO THE NORTH CAROLINA 
REGISTER 

The North Carolina Register is cited by volume, issue, 
page number and date. 1:1 NCR 101-201, April 1, 1986 

refers to Volume 1, Issue 1, pages 101 through 201 of 
the North Carolina Register issued on April 1, 1986. 



North Carolina Register. Published bi-monthly by 
the Office of Administrative Hearings, P.O. Drawer 
11666, Raleigh, North Carolina 27604, pursuant to 
Chapter 150B of the General Statutes. Subscriptions 
one hundred and five dollars ($105.00) per year. 
North Carolina Administrative Code. Published 
in looseleaf notebooks with supplement service by 
the Office of Administrative Hearings, P.O. 
Drawer 1 1666, Raleigh, North Carolina 27604, pur- 
suant to Chapter 150B of the General Satutes. 
Subscriptions seven hundred and fifty dollars 
($750.00). Individual volumes available. 



NORTH 
CAROLINA 
REGISTER 



ISSUE CONTENTS 




I. EXECUTIVE ORDER 

Executive Order 117... 



.474 



Office of Administrative Hearings 

P. O. Drawer 11666 

Raleigh, XC 27604 

(919) 733- 2678 



Julian Mann III, 

Director 
James R. Scarcella Sr., 

Deputy Director 
Molly Masich, 

Director APA Services 



II. PROPOSED RULES 

Environment, Health, and 
Natural Resources 

Marine Fisheries 

Commission 484 

Human Resources 
Mental Health, 
Developmental and 
Substance Abuse 

Services 475 

Insurance 
Actuarial Services 

Division 480 

Fire and Casualty 

Division 478 

Licensing Board 

Nursing, Board of 496 

Secretary of State 

Corporations Division 489 

Securities Division 495 

State Personnel 
State Personnel Commission ...500 



III. ARRC OBJECTIONS. 



.509 



Staff: 

Ruby Creech, 

Publications Coordinator 
Teresa Kil pat rick, 

Editorial A ssistant 
Jean Shirley, 

Editorial A ssistant 



IV. CUMULATIVE INDEX 512 



NORTH CAROLINA REGISTER 

Publication Schedule 

(January 1990 - December 1991) 

Issue Last Day Last Day Earliest * 

Date for for Date for Larlicst 

Liling Electronic Public Effective 

Eiling Hearing & Date 
Adoption by 
Agency 

******** ******** ******** ******** ******** 

0102/90 12/07/89 12/14/89 02/01/90 05 0190 

011690 12 20/89 12/29/89 02/15/90 05/01/90 

02 '01 90 01,10 90 01/18,90 03/03/90 06/01/90 

02 15 90 0125/90 02/01/90 03/17/90 06/01/90 
03/01/90 02/08/90 02/15.90 03/31/90 07 0L90 

03 15 90 02/22/90 03/01/90 04/14/90 07 0190 
04,02/90 03/12/90 03/19.90 05/02/90 08/01/90 

04 16 90 03/23/90 03/30,90 05 16 90 08 01/90 
05/01/90 04,09/90 04/17/90 05/3190 09/01/90 
05/15/90 04 2490 05/01/90 06/14/90 09/01/90 
06/01/90 05/10/90 05/17/90 07/01/90 10 0190 

06 15 90 05 '24/ 90 06'01/90 07 15/90 10 0190 
07/02/90 06/11/90 06/18.90 08.01/90 1101.90 

07 1690 06 22/90 06/29,90 08/15/90 1101,90 

08 01/90 07/11/90 07/18/90 08/3190 12 01/90 
08/1590 07/25/90 08/01,90 09 14 90 12 01/90 
09/04/90 OS 13/90 08/20/90 10.04/90 01 01 91 
09/14 90 08/24/90 08/3190 10 14/90 010191 

10 01/90 09/10/90 09/17/90 10 31/90 02 0191 
10/15/90 09/25/90 10 02/90 1114 90 02 0191 
11,01/90 10/11/90 10/18,90 11 30.90 03/01/91 
11,15/90 10 24,90 10/3L90 12/14/90 03 0191 
12 03 90 1108/90 1115 90 010291 040191 
12 1490 11/21/90 113090 0113 91 04 0191 
01/02/91 12 07 90 12 14,90 02/0191 05/01/91 
020191 01/10/91 0118/91 0303 91 0601.91 
03 0101 02,08/91 02 15 91 03 3191 07 0191 
040191 03/1191 03/1891 050191 08 0191 
05/01/91 04 10/91 04/17/91 05 3191 09 0191 
06/03/91 05 10/91 05/17,91 07/03,91 10 01 91 
07 0191 06 10 01 06/17,91 07/31/91 1101/91 
08/0191 07/11/91 07,18 91 08/31/91 12/01/91 
09/03 01 OS/12.91 08/19 91 10 03 91 010102 
10/01/91 09/10/91 09 17 91 10 3191 02 0192 

11 01 91 10/11/91 10 IS 91 12 01.91 03 01/92 

12 02 01 1107 91 11,14 91 01,0192 04 0102 



* The "Earliest Effective Date" is computed assuming that the public hearing 
and adoption occur in the calendar month immediately following the "Issue 
Date", that the agency files the rule with The Administrative Rules Review 
Commission by the 20th of the same calendar month and that .4RRC approves 
the nde at the next calendar month meeting. 



EXECUTIVE ORDER 



EXECUTIVE ORDER NUMBER 117 

AMENDING EXECUTIVE ORDER NUMBER 108 

TO INCLUDE THE SECRETARY OF THE DEPARTMENT OF REVENUE 

IN THE MEMBERSHIP OF THE NORTH CAROLINA DRUG CABINET 

By the authority vested in me as Governor by the Constitution and laws of North Carolina, IT IS 
ORDERED: 

Section L Executive Order Number 108, Section 2(a) is hereby amended to read as follows: 
"...(9) the Secretary of the Department of Human Resources;- 

(10) the Secretary of the Department of Transportation; and 

(1 1) the Secretary of the Department of Revenue." 

Section 2. This Order shall be effective immediately and shall remain in effect until terminated. 
Done in Raleigh, North Carolina this the 30th day of May, 1990. 



5:7 NORTH CAROLINA REGISTER July 2, 1990 474 



PROPOSED RILES 



run 10 - mv \r tment of hi man 

RESOURCES 

ly otice is hereby given in accordance with G.S. 
I SOB- 1 2 that the Commission for Mental Health, 

Developmental Disabilities and Substance Abuse 
Services intends to amend mles cited as 10 NCAC 
I4K .0403; I4M .0202. .0303, .0402 and adopt 
tides cited as JO NCAC 141. .0602 and .0603. 

1 he proposed effective date of this action is No- 
vember 1. 1990. 



Th 



he public hearing will be conducted at 10:30 
a.m. on August S. 1990 at Holiday Inn State 
Capitol. 320 Hillsborough Street. Raleigh, SC 
27603. 

C omment Procedures: Any interested person 
may present his her comments by oral presentation 
or by submitting a written statement. Persons 
wishing to make oral presentations should contact 
Marilyn Brothers. Division of Mental Health, De- 
velopmental Disabilities and Substance Abuse 
Senices. 325 X. Salisbury St., Raleigh. XC 
27603, (919) ~33-4~~4 by August v . 1990. The 
hearing record will remain open for written com- 
ments from July 2. 1990 through August 7, 1990. 
Written comments must be sent to the above ad- 
dress and tnust state the rule(s) to which the 
comments are addressed. Piscal information on 
these tides is also available from the same address. 

CHAPTER I-l - MENTAL HEALTH: GENERAL 

St BCIIAPTER 14k - CORE LICENSl RE RULES 

I OR MENTAL HEALTH: MENTAL 

RETARDATION AND OTHER 

DEVELOPMENTAL DISABILITIES: AND 

SI BSTANCE Alii SE FACILITIES 

SECTION .0400 - PHYSICAL PLANT 

.0403 COMPLIANCE Willi BI ILDING CODE 
REOl IREMENTS 

(a) As used in this Rule the term "new 
facility" refers to a facility which has not been li- 
censed previously and for which an initial license 
is being sought. The term does not refer only to 
a "new" building but will apply to an "old" 
building if the building houses a facility for which 
an initial license is being sought. 

(b) Each new facility specified in (d), (e), (f), 
fg). (h) and (i) of this Rule, with the exception 
of private home respite, alternative family living 
and apartment models, and supervised inde- 
pendent living, shall be in compliance with the 



current edition of Section 1 IX ol Volume I of the 
N.C. State Building ("ode. 

(c) Each new facility specified in (d), (e), (f), 
(g), (h) and (i) of this Rule, with the exception 
ot private home respite, alternative family living 
and apartment models shall be in compliance 
with the current edition of Volume II, III and IV 
of the N.C. State Building Code. 

(d) In addition to Building Code requirements 
specified in (b) of this Rule, new facilities speci- 
fied in (1), (2), and (3) of this Paragraph shall 
meet the requirements of the current edition of 
Volume I-B of the N.C. State Building Code as 
follows: 

( 1 ) Mental retardation or other developmental 
disability facilities: 

( A ) group homes for adults with mental 
retardation or other developmental disa- 
bilities serving six, or fewer clients who are 
ambulatory and able to respond on their 
own and evacuate the facility without as- 
sistance: and 

( B ) group homes for children with mental 
retardation or other developmental disa- 
bilities serving six or fewer clients who are 
ambulator, and able to respond on their 
own and evacuate the facility without as- 
sistance: and 

(C) (A) group homes for individuals with 
mental retardation or other developmental 
disabilities and with behavior disorders 
serving frn* six or fewer clients who are 
ambulatory and able to respond on their 
own and evacuate the facility without as- 
sistance; and 

( D) (4*4 community center-based respite for 
individuals with mental retardation, other 
developmental disabilities, developmental 
delays or at risk for these conditions serv- 
ing five or fewer clients who are 
ambulator}' and able to respond on their 
own and evacuate the facility without as- 
sistance. 

(2) Mental health facilities: 

(A) group homes and residential acute 
treatment for adult and elderly individuals 
who are mentally ill serving six or fewer 
clients who are ambulator, and able to 
respond on their own and evacuate the 
facility without assistance: and 

(B) residential treatment for children and 
adolescents serving six or fewer clients 
who are ambulatory and able to respond 
on their own and evacuate the facility 
without assistance. 

(3) Substance abuse facilities: 

(A) nonhospital medical detoxification for 
individuals who are substance abusers 



475 



5:7 NORTH CAROLINA REGISTER July 2, 1990 



PROPOSED RULES 



serving six or fewer clients who are 
ambulatory and able to respond on their 
own and evacuate the facility without as- 
sistance; 

(B) social setting detoxification for individ- 
uals who are alcoholics serving six or 
fewer clients who are ambulatory and able 
to respond on their own and evacuate the 
facility without assistance; and 

(C) halfway houses for individuals who are 
substance abusers serving six or fewer cli- 
ents who are ambulatory and able to re- 
spond on their own and evacuate the 
facility without assistance. 

(e) In addition to Building Code requirements 
specified in (b) and (c) of this Rule, new facilities 
specified in (1) and (2) of this Paragraph shall 
meet the requirements of the current edition of 
Volume I, Section 510 of the N.C. State Building 
Code as follows: 

( 1) Mental retardation or other developmental 
disability facilities: - 

(A) group homes for adults with mental 
retardation or cither developmental disa- 
bilities serving live or fewer clients all of 
whom are non-ambulators' or unable to 
respond and evacuate without assistance, 
certifiable for Medicaid reimbursement 
and staffed 24 hours per das with at least 
two staff awake at aH times: 

(B) f-Vf group homes for adults with mental 
retardation or other developmental disa- 
bilities serving more than six roi' i idontu cli- 
ents and fewer than ten r e sid e nts clients 
who are ambulatory and able to respond 
on their own to emergency conditions; 

(C) (-B} group homes for adults with mental 
retardation or other developmental disa- 
bilities serving six or fewer clients of 
whom one, two or three are non- 
ambulators' or unable to respond on their 
own to emergency conditions; 

(D) group homes for children with mental 
retardation or other developmental disa- 
bilities serving lis e or fewer clients all of 
whom are non-ambulatory or unable to 
respond and esacuate ss lthout assistance, 
certifiable for Medicaid reimbursement, 
and staffed 24 hours per das' with a]_ least 
two staff awake at_ all times: 

(I:) (€) group homes for children ssith 
mental retardation or other developmental 
disabilities serving five six or fewer Fe*i- 
de - nts clients of whom one, two or three 
are non-ambulatory or unable to respond 
on their own to emergency conditions; 

(V) group homes for individuals with men- 
tal retardation or other developmental 



disabilities and behavior disorders serving 
five or fewer clients all of whom are non- 
ambulatory' or unable to respond and 
evacuate without assistance, certifiable for 
Medicaid reimbursement, and staffed 24 
hours per day ssith at least two staff awake 
at all times; 
(G) fP) group homes for individuals with 
mental retardation or other developmental 
disabilities and with behavior disorders 
serving f+v*» six or fewer of whom one, two 
or three are non-ambulatory or unable to 
respond on their own to emergency con- 
ditions; 
(II) ft*} supervised independent living 
boarding homes for adults ssith mental 
retardation or other developmental disa- 
bilities serving more than six residents cli- 
ents and fewer than ten residents clients 
who are ambulatory and able to respond 
on their own to emergency conditions; 
(I) fP4, community center-based respite for 
individuals with mental retardation, other 
developmental disabilities, developmental 
delays or at risk for these conditions serv- 
ing six or fewer clients of whom one, two 
or three are non-ambulatory or unable to 
respond on their own to emergency con- 
ditions. 
(2) Mental health facilities: residential treat- 
ment for individuals serving seven to nine 
clients who are ambulatory and able to 
respond on their own and evacuate the 
facility without assistance, 
(f) In addition to Building Code requirements 
specified in (b) and (c) of this Rule, ness facilities 
specified in (1), (2) and (3) of this Paragraph shall 
meet the requirements of the current edition of 
Volume I, Section 409, Institutional Occupancy 
(I) of the N.C. State Building Code as follows: 
( 1 ) Mental retardation or other developmental 
disability facilities: 

(A) specialized community residential ser- 
vices for individuals with mental retarda- 
tion or other developmental disabilities; 

(B) group homes for adults ssith mental 
retardation or other developmental disa- 
bilities serving six or fewer re ii idonts clients 
of whom more than three are non- 
ambulatory a+*4 or unable to respond on 
their own to emergency conditions; 

(C) group homes for individuals ssith men- 
tal retardation or other developmental 
disabilities and with behavior disorders 
with serving six or tcss-cr clients of whom 
more than three clients who are non- 
ambulatory or unable to respond on their 
own to emergency conditions; 



5:7 NORTH CAROLINA REGISTER July 2, 1990 



476 



PROPOSED RULES 



(D) group homes for children with mental 
retardation or other developmental disa- 
bilities with serving six or fewer clients of 
whom more than three client '. v > ho are 
non-ambulatory or unable to respond on 
their own to emergency conditions; and 

(F) community center-based respite for in- 
dividuals with mental retardation, other 
developmental disabilities, developmental 
delays or at risk for these conditions serv- 
ing five or fewer clients of whom more 
than three are non-ambulatory or unable 
to respond on their own to emergency 
conditions. 

(2) Mental health facilities: 

(A) inpatient psychiatric facilities for indi- 
viduals who are mentally ill: 

(B) residential acute treatment for adult and 
elderly individuals who are mentally ill; 
and 

(C) residential treatment for children and 
adolescents serving ten or more clients. 

(3) Substance abuse facilities: 

(A) inpatient hospital treatment for indi- 
viduals who are substance abusers; and 

(B) nonhospital medical detoxification for 
individuals who are substance abusers. 

(g) In addition to Building Code requirements 
specified in (b) and (c) of this Rule, new facilities 
specified in (1), (2), (3) and (4) of this Paragraph 
shall meet the requirements of the current edition 
of Volume I, Section 405, Business Occupancy 
(B) of the N.C. State Building Code as follows: 

(1) Mental retardation or other developmental 
disability facilities: adult developmental 
activity programs for individuals with 
substantial mental retardation, severe 
physical disabilities or other substantial 
developmental disabilities; 

(2) Mental health facilities: 

(A) psychosocial rehabilitation programs 
for individuals who are chronically men- 
tally ill: 

(B) day treatment for children and adoles- 
cents who are emotionally disturbed; and 

(C) partial hospitalization programs (PUP) 
tor adult and elderly individuals who are 
acutely mentally ill; 

(3) Substance abuse facilities: 

(A) outpatient treatment for individuals 
who are substance abusers; 

(B) outpatient detoxification for individuals 
who arc substance abusers; and 

(C) outpatient methadone services for indi- 
viduals who are narcotic abusers; 

1 4) Facilities serving one or more disability: 
(A) sheltered workshops; and 



(B) day activity facilities for adult and el- 
derly individuals who are mentally ill 
and or substance abusers. 
(h) In addition to Building Code requirements 
specified in (b) and (c) of this Rule, new facilities 
specified in (1) and (2) of this Paragraph shall 
meet the requirements of the current edition of 
Volume I, Section 406, Educational Occupancy 
(E) of the N.C. State Building Code as follows: 

( 1 ) Mental retardation or other developmental 
disability facilities: before after school 
and summer developmental day services 
for children with mental retardation or 
other developmental disabilities; and 

(2) Mental health facilities: day treatment for 
children and adolescents who are emo- 
tionally disturbed. 

(i) In addition to Building ("ode requirements 
specified in (b) and (c) of this Rule, new facilities 
specified in ( 1 ) and (2) of this Paragraph shall 
meet the requirements of the current edition of 
Volume I, General Construction, Section 411, 
Residential Occupancy (R) of the N.C. State 
Building Code as follows: 

( 1 ) Substance abuse facilities: 

(A) social setting detoxification for more 
than six individuals who are alcoholics; 

(B) residential treatment or rehabilitation 
for more than six individuals who are 
substance abusers; and 

(C) halfway houses for more than six indi- 
viduals who are substance abusers. 

(2) Facilities serving one or more disability: 
residential therapeutic (habilitative) camps 
for children and adolescents. 

(j) Volume I (General Construction) is avail- 
able at a cost often dollars ($10.00); Volume I-B 
(Uniform Residential Building Code) at a cost 
of two dollars ($2.00); Volume II (Plumbing) at 
a cost of three dollars ($3.00): Volume III 
(Heating and Air Conditioning) at a cost of four 
dollars and fifty cents ($4.50); and Volume IV 
(Electrical) at a cost of fifteen dollars ($15.00) 
from the N.C. Department of Insurance, P.O. 
Box 26387, Raleigh, N.C. 27611. 

(k) The material which is adopted by reference 
in this Rule is adopted in accordance with the 
provisions of G.S. 150B- 14(c). 

Statutory Authority G.S. I22C-26; 143B-147; 
I50D-I4(c). 

SUBCHAPTER 141 - LICENSURE RULES FOR 
MENTAL HEALTH FACILITIES 

SECTION .0600 - RESIDENT1 \l TREATMENT 

FOR CHILDRF.N AND ADOI ESCENTS WHO 

ARK MENTAIJA 111 



5:7 yORTH C A ROLLS' A REGISTER July 2, 1990 



PROPOSED RULES 



.0602 CAPACITY 

Each facility shall serve no more than nine 
children at any one time. 

Statutory Authority G.S. 122C-26; 1 43 B- 147. 

.0603 IIOLRS OF OPERATION 

Each facility shall operate 24 hours per day, at 
least five days per week, at least 50 weeks per 
year, excluding legal holidays. 

Statutory Authority G.S. 122C-26; I43B-I47. 

SUBCHAPTER I4M - LICENSURE RILES FOR 

MENTAL RETARDATION/DEVELOPMENTAL 

DISABILITIES FACILITIES 

SECTION .0200 - GROUP HOMES FOR 

INDIVIDUALS WITH MENTAL RETARDATION 

OR OTHER DEVELOPMENTAL DISABILITIES 

AND WITH BEHAVIOR DISORDERS 

.0202 CAPACITY 

(a) The facility shall serve a maximum «-4 f+ve 
client '. , no more than six individuals at any one 
time. 

(b) No facility shall designate any bed for the 
continuous provision of respite services. 

Statutory Authority G.S. 122C-26; 143B-147. 

SECTION .0300 - <;K(H P HOMES FOR 

ADl IIS Willi MENTAL RETARDATION OR 

OTHER DEVELOPMENTAL DISABILITIES 

.0303 COMPLIANCE WITH GROUP HOME 
STANDARDS 

(a) The standards for private * group homes for 
developmcntally disabled adults which are lb 
censed under G.S 131-1') and a* defined de- 
scribed in the manual titled "Minimum and 
Desired Standards and Regulations for Group 
Homes for Developmcntally Disabled Adults" 
(10 NCAC 42B .0900 - .2300) published by the 
N.C. Department of Human Resources shall also 
apply to group Iminu'. operated bv an area pro 
g+*m except fof Section -. .1000. -24+4U a*4 -24i4U 
ef Subchapter 444 NCAC 42U *n4 w+t+t t4+t* e*- 
c e plion outlined h+ <4*+ ef (4++*r Rule. 1 hi ;, publi 
cation t* available l+ee h4 charge Irom t4+f N.C 
Department ±4 1 luman Resource '. , Division &£ 
Social Service 1 . . 424 X- Sail '. bury Street. Raleigh. 
N.C. 27M 1 . all private non-profit, private for 
profit or area operated group homes for devel- 
opmcntally disabled adults licensed under G S 
1 22-C. I hese standards shall not apply to any 
group home certilied as an Intermediate Care 
facility tor the Mentally Retarded or any group 
home holding a current certificate <M need to be 
developed as an Inlerniediale I are facility lor 



the Mentally Retarded. Sections .1000, .2200 
and .2300 of Subchapter ]0 NCAC 42B shall not 
apply to area operated group homes. This pub- 
lication is available free of charge from the N.C. 
Department of I luman Resources, Division of 
Social Services. 323 N. Salisbury Street, Raleigh, 
North Carolina 2761 1. 

(b) The provision in 10 NCAC 42C .2401 
(which is cross-referenced in 10 NCAC 42B 
.1701) that prohibits the admission of people 
"with disease in a communicable stage or earner 
state" shall not prohibit the admission of resi- 
dents who are hepatitis B carriers to a home op- 
erated by a public agency if the home is in 
compliance with the Rules codified in 10 NCAC 
I8H .0107 throuszh .0115; HEPATITIS B 
SCREENING AND VACCINATION OF RESI- 
DENTS AND DIRECT CARE. EMPLOYEES IN 
GROUP HOMES FOR MENTALLY RETARDED 
ADULTS. 

(c) The rules which are adopted by reference 
in this Rule are adopted in accordance with the 
provisions of G.S. 150B- 14(c). 



Statutory Authority G.S. I22C-26; 
I SOB- 14(c). 



I43B-14'/ 



SECTION .0400 - GROI P HOMES I OR 

CHILDREN WITH MENTAL RETARDATION 

OR OTHER DEVELOPMENTAL DISABILITIES 

.0402 CAPACITY 

(a) The facility shall serve no more than &¥» 
six children at any one time. 

(b) No facility shall designate any bed for the 
continuous provision of respite services. 

Statutory Authority G.S. 122C-26; I43B-I47. 

TITLE II - DEPARTMENT OF 
INSURANCE 



No 



otice is hereby given in accordance with G.S. 
I SOB- 1 2 that the N.C. Department of Insurance 
intends to amend nde(s) cited as II NCAC 10 
.1107. 



Th 



he proposed effective date of this action is No- 
vember I. 1990. 



Th 



he public hearing will be conducted at 10:00 
a. nj. on August IS. 1900 at 3rd floor Hearing 
Room. Dobbs Building, 430 X. Salisbury Street. 
Raleigh. N.C. 27611. 



Cc 



ommenl Procedures: Written comments may 
be sent to Pete Murdza, P.O. Box 263S7, Raleigh. 
N.C. 27611. Oral presentations may be made at 



5:7 NORTH CAROLINA REGISTER July 2,1990 



47 S 



PROPOSED RULES 



the public hearing. Anyone having questions 
should call Pete Murdza at {019) 733-3284. or 
Ellen Sprenkcl at (919) 733-4700. 

(II U'TFR 10 - HRF. AND CASUALTY 
DIVISION 

SF.CTION .1 100 - RATE FILINGS 

.1107 NONESSENTIAL LINES 
QUESTIONNAIRE 

The information required bv N.C.G.S. 
58 ISO(c - ) G.S. 58-41-50 for those lines of busi- 
ness described in Rule .1102 f-H ef th» Section 
jj_ NCAC 10 .1102(5) shall be submitted by the 
completion of a Rate Rate I oss Cost Filing 
Questionnaire and the necessary' supplementary 
exhibits to which the questionnaire refers. 

(1) The Rat e Rate Loss Cost Filing Question- 
naire shall contain the following informa- 
tion: 

(a) Name of Company Rating company Li- 
censed rating organization; 

(b) Filer's federal Employer's Number; 

(c) Filer's file number; 

(d) Type of tiling; 

(e) l.ine(s) of insurance, as shown on Page 14 
of the .Annual Statement; 

(f) Subline Program title; 

(g) Type of policies involved; 
(h) Reasons for the filing; 

(i) Proposed effective date and rules of im- 
plementation: 

(j) Filer's approximate market share of North 
Carolina written premium for the line(s) 
involved; 

(k) Percentage rate change proposed; 

(1) Estimated total dollar impact of the tiling 
upon North Carolina policyholders; 

(m) Whether the tiling will increase the pre- 
mium of any North Carolina 
policj holder; 

(n) Type of premium data included: 

(o) Exposure unit used; 

(p) Type of loss data included; 

(q) Permissible loss ratio, permissible loss and 
LAE ratio, or permissible loss, EAE. and 
fixed expense ratio; 

(r) Whether any expenses are treated as fixed: 

(s) Credibility information: 

(t) I oss development information; 

(u) Trend information: 

(v) Underwriting profit information: 

(w) Changes in methodologies; 

(x) Certification of accuracy. 

(2) Also submit supplementary exhibits shall 
c4-** b^ submitted containing the following 
information: 



The effect of the proposed filing on active 
filings affecting the fine or subline; 
A comparison of current and proposed 
rates; 

Five-year rate filing history; 
Premium and loss data (North Carolina 
and countrywide); 

Expense data (North Carolina and 
countrywide); 
(3) In filings fef » filing derived from a rate fil- 
ing made bv a licensed rating organization 
F*te t*f lew, e**-4 tiling, and m filings that in- 
corporate without modification loss costs 



(a) 

(b) 

(c) 
(d) 

(e) 



that have been tiled bv a licensed ratin 



« or- 



ganization, substitute a supplementary ex- 
hibit shall ba ■■ uh -. titutcd for the '.a ction ef 
items in the questionnaire containing the 
information described in Paragraphic . Sub- 
paragraphs ( l)(n) through ( 1 )(v). 
(a) For i41 both these types of rating organ 
i/ation filings, this exhibit shall contain 
the following information: 
(i) The name of the licensed rating organ- 
ization; 
(ii) The relationship of the company to the 

licensed rating organization; 
dii ) (-H-)- The applicable licensed rating or- 



cm4 r e striction;; 



ganization filing; 
ffii) Eligibility 



applicable k+ tl+e filing; 
(iv) The type of licensed rating organization 

filing; 
(v) Eligibility requirements and restrictions 

applicable to the company's filing. 

(b) In cases where the licensed rating organ- 
ization files final rates, this exhibit shall 
also identify the basis for the differences 
between the company's proposed rates 
and those tiled by the rating organization. 

(c) In cases where the licensed rating organ- 
ization files loss costs, this exhibit shall 
also contain the following information: 

(i) Permissible loss ratio, permissible loss 
and LAE ratio, or permissible loss, 1 AE. 
and fixed expense ratio: 

(ii) Whether any expenses are treated as 
fixed; 

(iii) An explanation of the derivation of the 
expense provisions and of their incorpo- 
ration into the final rates; 

(iv) Underwriting profit information. 
(4) For loss cost tilings made b\ licensed rating 

organizations, the following modifications 

apph to the requirements m this Rule: 

(a) Substitute percentage loss cost change 
proposed m Subparagraph I 1 ) ( k ) . 

(b) ( )mit the informati'n described in Sub- 
paragraphs ( 1 )(j i through ( 1 Hni. ( 1 Kg). 



479 



5:7 SORT II CAROLINA REG ESTER July 2, 1990 



PROPOSED RULES 



( l)(r). and ( l)(v) and the items in Sub- 
paragraph ( 1 )(u) relating to premium 
trend. 

(c) In the exhibit deseribed in Subparagraph 
(2)(b), compare current and proposed loss 
exists. 

(d) In the exhibit deseribed m Subparagraph 
(2)(c), provide a five-\car loss cost tiling 
history. 

(c) In the exhibit described in Subparagraph 
(2)td). omit those items relating to pre- 
mium, 
(f) Omit the exhibit described m Subpara- 
graph (2)(e). 
(5) lor installment premium payment plan 
filings, substitute a different questionnaire, 
containing the following inlormation: 
(a) Name of Company 1 [censed rating or- 
ganization; 
(h) I iler s federal Rmpjover Number; 

(c) Iiler s tile number; 

(d) 1 \ pe of filing; 

(e) I inc(s) of insurance; 

(f) Reasons for the filing; 

(g) Proposed effective date and rules of im- 
plementation; 

(h) 1 iler s approximate market share of North 

Carolina written premium tor the line(s) 

involved; 
(i) Percentage rate change proposed; 
(j) Estimated total dollar impact of the filing 

upon North Carolina policyholders; 
(k) A comparison of the current and proposed 

installment fees; 
(1) I iler s distribution of number of policies 

and premium bv installment payment 

options; 
(m) Certification of accuracy. 



Statutory Authority G.S. 58-2-40; 58-41-50. 



Cc 



************* 



* * * * 



Nc 



' otice is hereby gh'cn in accordance with G.S. 
I50B-I2 that the N.C. Department of Insurance 
intends to adopt rules cited as II NCAC 16 .0101 

- .0/07. 



1 he proposed effective dale of this action is No- 
vcmber I. 1990. " 

1 he public hearing will be conducted at 10:00 
a.m. on August 15. 1990 at Third Floor Hearing 
Room. Dobbs Building. 430 North Salisbury 
Street. Raleigh. Xorth Carolina 27611. 



omment Procedures: Written comments may 
be sent to Pete Murdza, P.O. Box 26387, Raleigh, 
N.C. 27611. Oral presentations may be made at 
the public hearing. Anyone having questions 
should call Pete Murdza at (919) 733-3284. or 
Ellen Sprenkel at (919) 733-4700. 

CHAPTER 16 - ACTUARIAL SERVICES 
DIVISION 

SECTION .0100 - I IRE AND CASUALTY 
STATISTICAL DATA 

.0101 APPLICABILITY 

The following Rules describe certain statistical 
data that shall be submitted to the Actuarial 
Services Division on a regular basis. 

(1) 11 NCAC 16 .0102 applies to all tire and 
casualty companies licensed or approved to 
do business in North Carolina. 

(2) 1 1 NCAC 16 .0103 applies to all companies 
that write North Carolina nonfleet private 
passenger automobile insurance and to all 
statistical organizations that collect data re- 
lating to that line of insurance. 

(3) 11 NCAC 16 .0104 applies to all companies 
that write North Carolina professional li- 
ability insurance and all North Carolina 
self-insurers of professional liability expo- 
sures. 

(4) 11 NCAC 16 .0105 applies to all companies 
that provide professional liability insurance 
to more than two percent of the insured 
physicians and surgeons in North Carolina. 

(5) 11 NCAC 16 .0106 applies to all companies 
that write North Carolina credit property 
insurance. 

(6) 1 1 NCAC 16 .0107 applies to all companies 
that write North Carolina nonfiling insur- 
ance. 

Statutory Authority G.S. 58-2-40(1); 58-2-190. 

.0102 LOSS RESERVES 

Shortly after a company is licensed, approved, 
or registered to do business in North Carolina, 
the Actuarial Services Division will mail to the 
company forms, instructions, and a diskette so 
that the company can complete the two items 
involving loss reserve information described in 
this Rule. The company will have two months 
from the receipt of the request to comply. (Note: 
Companies that are part of a group pooling ar- 
rangement may submit consolidated informa- 
tion.) 

(1) The reproduction on diskette of the fol- 
lowing portions of Schedules and P of the 
company's Annual Statements for the years 



5:7 NORTH CAROLINA REGISTER July 2, 1990 



4X0 



PROPOSED RULES 



1981-1988 or for those years during that pe- 
riod when the company was in operation: 

(a) Schedule O, Parts 3, '4, and 5; 

(b) Schedule P, Parts 1A through IF. 

(2) The completion of a series of interrogatories 
concerning the company's loss reserving 
practices. 

Statutory Authority G.S. 58-2-/90. 

.0103 NONFLEET PRIVATE PASSENGER 
AUTOMOBILE INSURANCE 

.Ml companies writing North Carolina nonflcet 
private passenger automobile insurance shall 
collect the statistical data described in this Rule 
and shall report such data to their statistical agent 
in a timely fashion. The statistical agents shall 
thereupon provide the data on a combined basis 
to the Actuarial Services Division. (Note: If any 
data required by this Rule are not being collected 
and reported, or are not readily available to an 
individual company prior to January 1, 1992, 
then the company shall commence as of that date 
to collect and report such data prospectively.) 

(1) Premium. Exposure. Loss, and Claim Ex- 
perience. Provide written and earned expo- 
sures, written and earned premiums, number 
of paid and incurred claims, and paid and 
incurred total losses biannually for each of 
the latest six accident or calendar half-years 
in the following detail: 

(a) by coverage: 

(b) by type of exposure (voluntary, involun- 
tary, standard, or substandard): 

(c) by territory; 
id I by class; 

(e) by limit deductible; 

(f) by cause or type of loss for comprehensive 

coverage. 

(Note: Simultaneous division of the data 
by class, by territory and by limit is not 
required. Rather data shall be provided 
divided simultaneously by territory and 
by limit, simultaneously by summarized 
class and by limit, and simultaneously by 
summarized class and by territory.) 

(2) Loss and Premium Experience by Zip 
Code. Provide data by zip code annually in 
the following detail: 

(a) calendar year earned or written premium 
tor all coverages combined; 

(b) accident year incurred losses and incurred 
claims valued at 15 months for bodily in- 
jurs and property damage coverages: 

(c) calendar year incurred losses and incurred 
claims valued at 1 5 months for compre- 
hensive and collision coverages; 



(d) calendar year voluntary earned exposures 
separately for bodily injury and property 
damage, comprehensive, and collision; 

(e) calendar year involuntary earned exposures 

for bodily injury and property damage; 

(f) calendar year substandard earned expo- 
sures for comprehensive and collision; 

(g) calendar year exposures for bodily and 
property damage for classes 1A, IB. 1C, 
3, and 1AF. 

(3) Loss Trend Experience. Provide earned 
exposures, earned premiums, number of 
claims, paid or incurred losses, loss fre- 
quency, and loss severity quarterly for each 
of the latest 16 three-month and twelve- 
month calendar periods in the following de- 
tail: 

(a) Lor bodily injury coverage: 

(i) basic limits and total limits paid trends 
including allocated loss adjustment ex- 
pense; 

(ii) basic limits and total limits paid trends 
excluding allocated loss adjustment ex- 
pense; 

(in) basic limits and total limits incurred 
trends including allocated loss adjustment 
expense: 

(iv) basic limits and total limits incurred 
trends excluding allocated loss adjustment 
expense. 

(b) For property damage coverage, the same 
trends provided for bodily injury. 

(c) Lor medical payments coverage, total 
limits paid trend excluding allocated loss 
adjustment expense. 

(d) For uninsured motorist bodily injury 
coverage: 

(i) total limits paid trend excluding allocated 
loss adjustment expense; 

(ii) total limits incurred trend excluding al- 
located loss adjustment expense. 

(e) For comprehensive coverage: 

(i) paid trend excluding allocated loss ad- 
justment expense for exposures with no 
deductible; 

(ii) paid trend excluding allocated loss ad- 
justment expense separately for exposures 
with deductibles of fifty dollars ($50.00). 
one hundred dollars ($100.00), two hun- 
dred dollars ($200.00), two hundred fifty 
dollars ($250.00), five hundred dollars 
($500.00). and one thousand dollards 
($1000.00): 

(in) paid trend excluding allocated loss ad- 
justment expense for all exposures not 
otherwise included. 

(f) for collision coverage: 



-M7 



v 



SORT II CAROUSA REGISTER July 2,1990 



PROPOSED RULES 



(i) paid trend excluding allocated loss ad- 
justment expense separately for exposures 
with deductibles of fifty dollars ($50.00), 
one hundred dollars ($100.00), two hun- 
dred dollars ($200.00), two hundred fifty 
dollars ($250.00), five hundred dollars 
($500.00), and one thousand dollars 
($1000.00); 

(ii) paid trend excluding allocated loss ad- 
justment expense for all exposures not 
otherwise included. 

(4) liability Loss Development Experience. 
Provide loss and earned exposure data at 
annual evaluation dates from 15 to 63 
months biannually for at least ten accident 
or fiscal 'accident years in the following de- 
tail: 

(a) For bodily injury and property damage 
coverages (separately for voluntary busi- 
ness and for ceded business, and on a 
combined basis): 

(i) basic limits paid losses; 

(ii) basic limits incurred losses; 

(iii) total limits paid losses; 

(iv) total limits incurred losses; 

(v) paid claims; 

(vi) incurred claims; 

(vii) estimated premium for the corre- 
sponding calendar year; 

(viii) estimated exposures for the corre- 
sponding calendar year. 

(b) F'or medical payments coverage (sepa- 
rately for voluntary business and for ceded 
business, and on a combined basis): 

(i| total limits paid losses; 

(ii) total limits incurred losses; 

(in) paid claims; 

(iv) incurred claims; 

(v) estimated premium for the correspond- 
ing calendar year; 

(vi) estimated exposures for the corre- 
sponding calendar year. 

(c) For uninsured and underinsured motorist 
coverage: 

(l) total limits paid losses; 

(ii) total limits incurred losses; 

(iii) paid claims; 

(iv) incurred claims; 

(v) estimated premium for the correspond- 
ing calendar year; 

(vi) estimated exposures for the corre- 
sponding calendar year. 

(5) Physical Damage Age and Symbol Trend 
Experience. Provide the average age and 
symbol value for each of the latest 26-month 
periods biannually for the following cover- 
aucs: 



(a) full coverage comprehensive; 

(b) comprehensive coverage with a fifty dollar 
($50.00) deductible; 

(c) comprehensive coverage with a one hun- 
dred dollar ($100.00) deductible; 

(d) collision coverage with a one hundred 
dollar ($100.00) deductible; 

(e) collision coverage with a two hundred fifty 
dollar ($250.00)" deductible; 

(f) collision coverage with a five hundred dol- 

lar ($500.00) deductible. 

Statutory Authority G.S. 58-2-190. 

.0104 PROFESSIONAL LIABILITY INSI RANGE 

To fulfill the requirements of G.S. 58-2-170, 
every insurer, self-insurer, and risk retention 
group that provides professional liability insur- 
ance in North Carolina shall complete annually 
a Professional I iability Report form. This form 
is contained on a diskette that is mailed in the 
early part of each year (applicable to the prior 
year) by the Actuarial Services Division. I'nless 
otherwise specified, an automatic extension of 
three months will be granted, making the report 
due on May 1. Individual companies shall sup- 
ply the information described in this Rule on 
both a net and a direct basis. (Note: All licensed 
insurers, approved surplus lines carriers, and reg- 
istered risk retention groups that do not insure 
any professional liability exposures in North 
Carolina shall submit a statement to that effect, 
which will be kept in the Department's tiles. If 
subsequently such a company begins to insure 
such exposures, it shall notify the Department 
within 30 days of this change. All self-insurers 
of profession^ liability exposures must notify the 
Department of their status as self-insurers in a 
letter to the Actuarial Services Division.) 

( 1 ) Number of claims pending at the beginning 
of the year; 

(2 1 Number of claims pending at the end of 
the year; 

(3) Claims closed with payment (after court 
judgment, other, and total); 

(4) Claims closed without payment (after 
court judgment, other, and total); 

(5) Amount of claims closed with payment of 
court judgment (highest, lowest, average, 
median); 

(6) Amount of claims closed with payment of 
out of court settlement (highest, lowest, av- 
erage, median); 

(7) Total payments made prior to the latest 
year on claims closed in that year; 

(8) Total payments made in the latest year on 
claims pending at the end of that year; 



5:7 NORTH CAROLINA REGISTER July 2, 1990 



4S2 



PROPOSED RULES 



(9 



(10 

(11 



(i: 



Average loss reserve per claim pending at 
the beginning of the year and at the end of 
the year (case reserve, IBNR reserve, total); 
) Direct premium written and earned; 
) Allocated loss adjustment expenses paid, 
unallocated loss adjustment expenses paid, 
and other underwriting expenses paid; 
) Average loss reserve per claim pending at 
the beginning of the year and at the end of 
the year (case allocated reserve, IBNR allo- 
cated reserve, unallocated reserve, total). 



Statutory Authority G.S. 58-2-170; 5S-2-/90. 

.0105 PHYSICI VNS AM) SI RGEONS 

PROFESSIONAL LIABILITY INSl RANCE 

All companies that insure more than two per- 
cent o( the insured physicians and surgeons in 
North Carolina shall provide the following data 
on an annual basis and in a timely fashion to the 
Actuarial Services Division. (Note: The data 
may be submitted separately or as part of a rate 
filing made during a calendar year. If a company 
does not currently collect any data required by 
this Rule, then that company shall commence as 
oi^ the effective date of this Rule to collect such 
data prospectively.) 

( 1 ) Number of insured doctors by specialty 
(North Carolina only); 

(2) Basic limits losses and ultimate claims for 
the most recent ten accident or report \ears 
at the most recent evaluation date (North 
Carolina and countrywide); 

(3) Class one frequency, basic limits severity, 
and basic limits pure premium for the most 
recent ten accident or report years at the 
most recent evaluation date (North Carolina 
and countrywide); 

(4) Exposure distributions separately by class, 
by maturity, and by increased limits factor 
for the most recent ten calendar years 
(North Carolina only); 

(5) Percentage of claims closed with neither a 
loss payment nor an allocated loss adjust- 
ment payment and the percentage of claims 
closed with only an allocated loss adjust- 
ment payment for the most recent ten cal- 
endar and tor the most recent ten accident 
or report years at the most recent evaluation 
date ( North Carolina only ). 

Statutory Authority G.S. 5S-2-40(i); 58-2-190; 
58-41-50(14). 

.0106 CREDIT PROPER H INSURANCE 

To fulfill the requirements o( G.S. 58-57-90, 
each writer of North Carolina credit property in- 
surance shall by April 1 ot each year submit the 



data described in this Rule to the Actuarial Ser- 
vices Division. (Note: If a company does not 
currently collect any data required by this Rule, 
that company shall commence as of the effective 
date oi this Rule to collect such data 
prospectively.) 

( 1) North Carolina premium, loss, and expense 
for each of the five latest calendar years on 
a direct basis: 

(a) Written premium; 

(b) barned premium: 

(c) Paid losses and claims; 

(d) Incurred losses and claims; 

(e) Paid loss adjustment expense; 

(f) Incurred loss adjustment expense; 

(g) Incurred commissions and brokerage ex- 
penses; 

(h) Incurred other acquisition costs; 

(i) Incurred premium taxes; 

(j) Other incurred expenses; 

Ik) Incurred loss and loss adjustment expense 

ratio; 
(1) Incurred loss and expense ratio, 
(m) Dividends paid; 
(n) Retrospective rate credits paid. 

(2) Investment income on loss, loss expense. 
and unearned premium reserves on a direct 
basis: 

(a) Loss reserve at the beginning of the year; 

(b) I oss reserve at the end of the year; 

(c) I oss expense reserve at the beginning of 
the year; 

(d) Loss expense reserve at the end of the 
year; 

(e) Unearned premium reserve at the begin- 
ning of the year; 

(f) Unearned premium reserve at the end of 
the year; 

(g) Investment income earned on loss, loss 
expense, and unearned premium reserves. 

(3) Nonrefundable fees collected: 

(a) Total number of transactions; 

(b) Transactions involving insured values less 
than two hundred titty dollars ($250.00); 

(c) Transactions involving insured values ot 
two hundred fifty dollars ($250.00) or 
more but less than five hundred dollars 
($500.00); 

(d) Transactions involving insured values of 
five hundred dollars ($5(10.00) or more. 

(4) Insured values: 

(a) Insured values for single interest insurance 
at the beginning of the year; 

(b) Insured values for single interest insurance 
at the end o( the year; 

(c) Insured values for dual interest insurance 
at the beginning of the year; 



■/.v.* 



5:7 NORTH CAROLINA REGLSTER July 2,1990 



PROPOSED RILES 



(d) Insured values for dual interest insurance 
at the end of the year. 
(5) Supplementary information: 

(a) Identification of the Page 14 Annual 
Statement line under which the experience 
is reported; 

(b) I:\planations for any changes in premi- 
ums, loss ratios, or expense ratios that are 
greater than 50 percent of the previous 
year's value. 

Statutory Authority G.S. 58-57-90(b). 

.0107 NONFILING INSURANCE 

So that the Commissioner may fulfill his duties 
under G.S. 53-177, all writers of North Carolina 
nonfiling insurance shall submit the following 
information for the previous calendar year to the 
Actuarial Services Division by March 1 of each 
year: 

(1) Written premium; 

(2) Famed premium; 
(i) Earned exposures; 

(4) Incurred losses; 

(5) Number of incurred claims; and 

(6) Incurred expenses. 

Statutory Authority G.S. 53-/77; 58-2-40(i). 

TITLE I5A - DEPARTMENT OF 

ENVIRONMENT, HEALTH, AND 

NATURAL RESOURCES 



No 



oticc is hereby given in accordance with G.S. 
I50B-12 that the N.C. Marine Fisheries Commis- 
sion intends to amend rulefs ) cited as 15A NCAC 
3B .0/02, .0/05, .0501, .0901, .0907, .1002, .1 101, 
.1503: 3C .0203, .0311. 

1 he proposed effecth-e date of this action is No- 
vember J, 1990. 

1 he public hearing will be conducted at 7:00 
p.m.: 

August I, 1990 

Ocracoke School 
Ocracoke, XC 

August 6. 1990 



Joslyn Hall 

Carteret Community College 

Morchead City, XC 

August 7. 1990 



Onslow County Courthouse 
Jacksonville, XC 

August 8, 1990 

Brunswick County Government Complex 

Highway 17 

Bolivia, XC 

Business Session will be August 9. 1990, at 9:00 
a.m. at the Carolina Power and Light Media 
Center, Southporl, X.C. 



Cc 



omment Procedures: Comments and state- 
ments, both written and oral, may be presented at 
the hearings. Writ ten comments are encouraged 
and may be submitted to the Marine Fisheries 
Commission. PO Box 769, Morehead City, XC 
2S557. These written and oral comments must 
be received no later than August 8, 1990. 

CHAPTER 3 - MARINE FISHERIES 

SUBCHAPTER 3B - FISHERIES REGULATIONS 
FOR COASTAL WATERS 

SECTION .0100 - GENERAL REGULATION'S 

.0102 DEFINITIONS 

(b) The following additional terms are hereby 
defined: 

(11) Mechanical methods for clamming: i+t- 
cludi". . , b+*4- Ht^- limited tor toothed 
dredger . , hydraulic clam dredge ;. , '. tick 
rak e-. tH+4 other Fakes when towed by eft- 
at+e power, patent tong ;. , kicking with 
propeller ' . , and or deflector plate ', with t+F 
without tru win, tm4 w+y other method t+n+t- 
uti li ze -, mechanical t+? hydraulic power k+ 
hane '. t clam; . . 
(A) I [ydraulic - anv method utilizing water 
pressure to harvest clams including, but 
not limited to. kicking with propellers 
and or deflector plates with or without 
trawls or cages and hvdraulic clam dredg- 



ing boats with escalators 
(B) lowed - an 



am harvesting 



towed by engine power including, but not 
limited to. dredges, clam trawls or cages. 



stick rakes, and hand rakes. 
(C) Mechani cal lifting gear - 



:1am har- 



Commissioner's Room 



vesting device operated hv or lifted with 
mechanically powered lilting gear includ- 
ing, but not limited to. patent tongs w hen 
not towed bv engine power. 

Statutory Authority G.S. 113-134: 143B-289.4. 

.0105 LEGAL SIZES AND CREEL LIMITS 



5:7 NORTH CAROLINA REGISTER July 2, 1990 



4S4 



PROPOSED RULES 



(a) Crab minimum size and tolerance limits are 
presented in 15A NCAC 3B .0800. 

(b) Clam minimum size and creel limits are 
presented in 15A NCAC 3B .0900. 

(c) Sea scallop minimum si/e and tolerance 
limits are presented in 15A NCAC 313 .1005. 

(d) Oyster minimum size, creel, and tolerance 
limits are presented in 15A NCAC 3B .1100. 

(e) The lobster minimum size limit is presented 
in 15A NCAC 3B .1200. 

(f) Striped bass legal sizes and creel limits are 
presented in 15A NCAC 3B .1500 and 3F .0100. 

fg) Red Drum: 

( 1 ) It is unlawful to take or possess more than 
two red drum exceeding 32 inches in 
length in any one day. except that this 
dailv possession limit may be reduced by 
proclamation m accordance with Subpar- 
agraph ie)[4) of this Rule. 

(2) It is unlawful to possess red drum less than 

14 inches in length, except that this mini- 
mum size limit may be increased b\ 
proclamation in accordance with Subpar- 
agraph I mi 4) of this Rule 

(3) It is unlawful to remove red drum from 
any type of net with the aid of any boat 
hook, gaff, spear, gig, or similar device. 

(4) The fisheries Director, may by procla- 
mation, impose any or all of the following 
additional restrictions on the taking of red 
drum: 

(A) Specify areas, 

(B) Specify seasons, 

(C) Specify quantity. 

(D) Specify means methods, and 
1 1 ) Specify size. 

(h) It is unlawful to land or possess aboard a 
vessel any striped bass, red drum, spotted 
seatrout or flounder mutilated to the extent that 
accurate length measurements cannot be made. 

(i) It is unlawful for individuals claiming ex- 
emption from the oyster, scallop and clam license 
required by G.S. 1 13- 154(a) to take or possess 
more than the quantities specified in G.S. 
11 3- 152(f). 

(j) It is unlawful to possess flounder less than 
13 inches in length. 

(k) It is unlawful to possess spotted seatrout 
I speckled trout) less than 12 inches in length. 

( 1 ) It is unlawful to possess aboard or land from 
a vessel, or combination of vessels that form a 
single operation, more than 3,500 pounds of 
Spanish or King Mackerel, in the aggregate, in 
any one daw I he Fisheries Director, may by 
proclamation, impose any or all of the following 
restrictions on the takinn of Spanish and or Kim: 
Mackerel: 

( 1 ) Specify areas. 



(2) Specify seasons, 

(3) Specify quantity, 

(4) Specify means, methods, and 

(5) Specify size. 

Any proclamation prepared under this authority 
must be approved by the Marine Fisheries 
Commission prior to issuance. 

(m) Inland game fish, except spotted seatrout. 
taken incidental to any licensed commercial fish- 
ing operation may be retained to the extent per- 
mitted by regulations of the Wildlife Resources 
Commission. 

(n) The Fisheries Director may, by proclama- 
tion, until September 1. 1991. impose any or all 
of the following restrictions in the shark fishery: 
( 1 ) Specify size, 

(2) Specify seasons, 

(3) Specify areas, 

(4) Specify quantity. 

(5) Specify means methods, and 

(6) Require submission of statistical and bi- 
ological data. 

(o) The Fisheries Director may. by proclama- 
tion, until September 1. 1991, impose any or all 
of the following restrictions in the fishery for 
species of the snapper-grouper complex listed in 
the South Atlantic Fisher. Management Council 
Fishery Management Plan for the Snapper- 
Grouper Fishery of the South Atlantic Region: 
( 1 ) Specify size, 

(2) Specify seasons, 

(3) Specify areas, 

(4) Specify quantity. 

(5) Specify means methods, and 

(6) Require submission of statistical and bi- 
ological data. 

Statutory Authority G.S. 113-134; II 3- 1 82; 
113-221'; I43B-289.4. 

SECTION .0500 - DREDGES, POTS, RAKES AND 
OTHER FISHING DEVICES 

.0501 DREDGES AND MECHANICAL METHODS 

(a) It is unlawful to use or have aboard a vessel 
am dredge weighing more than 100 pounds, ex- 
cept for t akin l: clams m the Atlantic ( )cean. 

Statutory Authority G.S. 1/3-/34; 113-182; 
143B-289.4. 

SECTION .0900 - (I VMS 

.0901 SIZE AND 11 VRVEST LIMIT, 

PERMIT, METHOD OK FAKING CLAMS 

(a) It is unlawful to take. land, or possess 
aboard a vessel more than 6.25n 5.I""" 1 clams per 
fishing operation from public bottom in internal 
waters except that the harvest limit inav be re- 



4S5 



5: 



XORTH CAROLI.XA REGISTER July 2.1990 



PROPOSED RULES 



duced by proclamation m accordance w ith Sub- 
paragraph (c)(3) of this Rule. It is unlawful to 
take, possess, sell or purchase any clams (except 
Rangia or freshwater clams) less than one inch 
thick, except that this minimum size limit may 
be increased by proclamation in accordance with 
Subparagraph (c)(3) of this Rule, or except in 
accordance with 1 5A NCAC 3B .()'X)7(h). 
Clams shall be culled by the catcher where taken 
and all clams of less than legal size with their 
shell, shall be immediately returned to the bot- 
tom where taken. The Fisheries Director and 
his agents are authorized and empowered to 
grade all, or any portion, or any combination of 
portions of the entire quantity of clams being 
graded and may require seizure and return to 
public bottom or other disposition as authorized 
by law of the entire quantity being graded or any 
portion thereof. 

(b) It is unlawful to take clams by any method, 
other than by hand tongs, hand rakes, or by 
hand, except as provided in Paragraph (c) of this 
Rule. Regardless of the areas which may be 
opened, it is unlawful: to take clams by any 
method other than hand tongs, hand rakes as 
described in 15A NCAC 3B .0505, or by hand in 
any live oyster bed, or in any established bed of 
aquatic vegetation which is defined as those ma- 
rine and estuarine areas of North Carolina where 
eelgrass (Zostera marina), shoalgrass (Halodule 
wrightii), widgeon grass (Ruppia maritima), and 
smooth or salt water cordgrass (Spartina 
alterniflora) that may exist together or separately. 

These vegetation beds occur in both subtidal and 
intertidal zones, and may occur in isolated 
patches or cover extensive areas. In either case, 
the bed is defined by the presence of and consists 
of entire plants (which during some seasons may 
be mostly underground) including the above 
ground leaves and the below ground rhizomes, 
together with the sediment in which the plant 
grows. 

(c) Permit requirements and the season for 
taking clams with mechanical methods are as 
follows: 

(1) It is unlawful to take clams by the use of 
mechanical methods except by special 
permit. Such permits may impose condi- 
tions and requirements reasonably neces- 
sary for management and enforcement 
purposes. 

(2) It is unlawful to take, buy, sell, or possess 
any clams taken by mechanical methods 
from public bottom except that the 
Fisheries Director, may, by proclamation: 

(A) Open and close the season at any time 
i_n the Atlantic Ocean and only between 
December 1 through March 31 in internal 



waters for the 
harvesting gear 
3B .0102(1 1). 



if mechanical clam 
15A NCAC 



as dclincu in 



(B) Open and close the season at any time 
of the year for the use of mechanical lift- 
ing clam harvesting near as deiined in 1 5A 



[3} 



NCAC 3B .0102(11 KC). 



the fisheries Director is further em- 
powered to impose any or all of the fol- 
lowing restrictions during any open season 
established by proclamation in Subpara- 
graph (c)(2) of this Rule: 

(A) Specify number of days, a«4 

(B) Specify areas, 

(C) Specify time period, 

(D) Specify quantity and or size, and 

(F) Specify means/methods. Any procla- 
mation specifying means and/or methods 
must be approved by the Marine fisheries 
Commission prior to issuance. 
(4) (rty For temporary openings made upon the 
recommendation of Shellfish Sanitation, 
for maintenance dredging operations, for 
the taking of Rangia clams, or for relaying 
of polluted clams to private leases, deeds, 
or grants as permitted by 15A NCAC 3B 
.0906, season and harvest limits »»ttH- 
iSA \CAC *U rmm- in Paragraph (a| of 
this Rule may not apply. 

(d) It is unlawful for any person to take clams 
from any shellfish management area which has 
been closed and posted by the state, except that 
the Fisheries Director, may open specific areas to 
allow the taking of clams and may designate 
time, place, character, or dimensions of any 
method or equipment that may be employed. 

(e) The Fisheries Director may, by proclama- 
tion, open only areas in Core and Bogue Sounds, 
Newport, North, White Oak and New Rivers 
and the Intracoastal Waterway north of "BC" 
Marker at Topsail Beach which have been 
opened at any time from January, 1977, through 
September, 1988, and the Atlantic Ocean to the 
harvest of clams by mechanical methods as de- 
fined in J_5A NCAC 3B .0IO2(ll)(A) and (B). 
Other areas opened for purposes as set out in 
R+^ 4WU4- (e) (0+ Subparagraph (c)(4) of this 
Rule will open only for those purposes. 

(f) It is unlawful to possess clam trawls or cages 
aboard a vessel at any time, or have 
kick deflector plates normally used in the me- 
chanical harvest of clams affixed to a vessel at 
any time, except during the time period specified 
for a upi » n mechanical clam harvest season in 
internal waters in accordance with Subparagraph 
(c)(2)(A) of this Rule. A period of 14 days be- 
fore and after the mechanical clam han e-. t season 
as specified will be allowed for the installation 



5:7 NORTH CAROLINA REGISTER July 2, 1990 



4S6 



PROPOSED RULES 



and removal of kick deflector plates and clam 
trawls or cases. Vessels with permits for activ- 
ities provided for in 15A NCAC 3B Rules .0903, 
.0906, Section .1600, and 3C .0203, shall be ex- 
empt from this Rule during the times such ac- 
tivities are permitted. 

Statutory Authority G.S. 113-134; 113-182; 
1 13-221'; I43B-2S9.4. 

.0407 CI AM HATCHERIES 

(a) A clam hatcher, - is defined as any operation 
which obtains clams through the process of arti- 
ficial spawning and or culture methods. A clam 
hatchery permit is required in accordance with 
15A NCAC 3C .0212. 

(4*+ 14 is unlawful fc» posse** undersized clam* 
from a hatchery unl e ** ■ .iiich clam* we identified 
m » manner A*rf- w+H- permit immediate determi 
nation t-4 t+k» point t4 origin a+t4 the ultimat e 
destination. 

lb) hH Possession and sale of clams by a 
hatchers or clam aquaeulture operation and pur- 
chase and possession of clams from a hatchery 
or clam aquaeulture operation shall be exempt 
from bag and size limit restrictions in 15A 
NCAC 3B .0901(a). except that- rt t* unlawful te 
possess, s^Ur *+f transport under 'i ii'.e clam* f+w 
purpose - * other than glow out k* l e ga l *we fof 
market. It is unlawful to [possess , sell, purchase, 
or transport such clams unless thev are identified 
in a manner that will permit immediate determi- 
nation <_>t the point of origin and the ultimate 
destination. 

Statutory Authority G.S. 113-134; 1 13-182; 
143B-289.4. 

SECTION .1000 - SCALLOPS 

.1002 \i\\ SCALLOP SEASON AND 
HARVEST LIMITS 

(a) It is unlawful to take bay scallops except 
that the fisheries Director may, by proclamation, 
open the season for harvest, sale, possession and 
transport of bay scallops for up to four days in 
December and between the second Monday in 
January and the last Friday in May. The 
fisheries Director may. by proclamation, provide 
fo'r an open season during the period August 1 
through September 15 to hand harvest only (by 
hand, dip nets, scoops, hand tongs and hand 
rakes). The Fisheries Director is further em- 
powered to impose any or all of the following 
restrictions: 

( 1 ) Specify number of days. 

(2) Specify areas. 



(3) Specify means and methods which may 
be employed in the taking, 

(4) Specify time period, and 

(5) limit the quantity. 

(b) for any season provided from December 
through May, it is unlawful to take more than 
20 standard U.S. bushels per person » am- m+e 
per day or to exceed a total of 40 standard U.S. 
bushels per day in any combined fishing opera- 
tion p*f dr^y except *s *pecifi e d » f44 t+f t+H*. 
Rul e , that these harvest limits may be reduced 
by proclamation in accordance with Paragraph 
(a) of this Rule. 

(c) for any season provided from August 1 
through September 15, it is unlawful to take 
more than ten standard U.S. bushels per person 
h+ am- H4+e per day or exceed a total of 20 stand- 
ard U.S. bushels per dav in any combined fishing 
operation pef 4*¥ except a* specified m f4+ h+ (4h* 
Rule, that these harvest limits max be reduced 
bv proclamation m accordance with Paragraph 
(a) of this Rule. 

(d) It is unlawful to take bay scallops between 
sunset and sunrise, or on Saturdays or Sundays, 
except that one-half bushel per person, not to 
exceed one bushel per vessel may be taken by 
hand rakes, hand tongs, dip nets, and by hand for 
personal consumption on Saturday and Sunday 
during the regular open season. 

Statutory Authority G.S. 113-134; 113-182; 
113-221; I43B-289.4. 

SECTION .1 100 - OYSTERS 

.1101 OYSTER SEASON 

(a) It is unlawful to take. buy. sell, or possess 
any oysters from public bottoms except during 
the open season which begins October 15 for 
hand harvest, and November 1 for dredges me- 
chanical methods and extend* may extend 
through March 31. During the open season, the 
fisheries Director may. by proclamation, close 
and open any of the various waters to the taking 
of oysters and may impose any or all of the fol- 
lowing restrictions: 

( 1 ) Speeit\ number of days, 

(2) Specify areas, 

(3) Specify means and methods which may 
be employed in the taking, 

(4) Specif) time period, and 

(5) L imit the quantity. 

(b) It is unlawful to take, land, or possess 
aboard a vessel more than 50 bushels of oysters 
at any one time, except that this trip limit may 
be reduced or modified to ± person or daily limit 
by proclamation in accordance w ith Paragraph 
(a) of this Rule. 



487 



5:7 XORTII CAROLIXA REGISTER July 2. 1990 



PROPOSED RULES 



Statutory Authority G.S. I 13-134; 113-182; 
113-201'; 113-221; 143B-289.4. 

SECTION .1500 -STRIPED BASS AM) MULLET 

.1503 STRIPED BASS: SIZE AND CREEL 

LIMIT, INTERNAL COASTAL WATERS 

(a) It is unlawful to possess striped bass har- 
vested from internal coastal waters less than 14 
inches long (total length), except that this mini- 
mum si/.c limit mav he increased hv proclama- 
tion in accordance with L5A NC AC 3B .1502. 
Fish that do not meet the minimum si/e limit 
shall immediately be returned to the waters where 
from which taken regardless of condition. 

(b) It is unlawful for any person to possess 
more than three striped bass in any one day taken 
by hook-and-linc from internal coastal waters, 
except that this possession list mav be reduced 
hv proclamation in accordance with 1 5A NCAC 
3B .1502. 

Statutory Authority G.S. 113-134; 113-182; 
143B-289.4. 

SI BCIIAPTER 3C - LICENSES: PERMITS: AND 
LEASES 

SECTION .0200 - PERMITS 

.0203 PERMIT LOR MECHANICAL HARVEST 
OF CLAMS 

(a) It is unlawful to harvest clams by the use 
of mechanical methods from public or private 
bottom without first obtaining a permit as pro- 
vided in 15A NCAC 3B .0001. Such permits 
mav limit the tvpes of mechanical clamming 
methods as defined in I5A NCAC 3B 
(( 



.0102( 1 1)(A), (B). and 
seasons in accordance 



ind the season or 
with 1 5A NCAC 3B 
.0901(c)(2)(A) and (B). Permits are valid only 



in areas, at times, and under conditions specified 
by the Fisheries Director based on concerns for 
other fisheries resources in the vicinity of the 
areas within which such activity is permitted. 

(b) The permit will be revoked or suspended 
under the following conditions: 

( 1 ) If any permit holder refuses to provide 
clam harvest information upon contact by 
division staff, cither by telephone or in 
person, his permit shall be suspended. 
Permits may be reinstated ten days after 
requested information is provided. 

(2) Upon conviction of violation of any ma- 
rine fisheries law , regulation, or -procla- 
mation involving the use of mechanical 
methods, the owner's permit will be sus- 



pended for no less than the following time 
periods: first conviction -- 10 days; sec- 
ond conviction within three years -- 30 
days; third conviction within three years 
— 60 days; and upon the fourth conviction 
within a three-year period, the permit will 
be permanently revoked. 

(3) Upon conviction of violation of 15A 
NCAC 3B .1111 or conviction of taking 
clams with the use of mechanical methods 
from coastal waters that are closed by 
proclamation because of pollution, the 
owner's permit will be suspended for 30 
days for the first conviction, and after the 
second conviction within a three-year pe- 
riod the permit will be permanently re- 
voked. 

(4) In the event the person makes application 
for a new permit during the period of 
suspension, no new permit will be issued 
during the time specified in this Rule. In 
cases of permanent revocation the mini- 
mum waiting period before application for 
a new permit will be considered will be six 
months; then only after a hearing before 
the fisheries Director or his agent and a 
finding that issuance of the permit will be 
in the best interest of fisheries manage- 
ment may a new permit be issued. 

Statuton' Authority G.S. 1/3-134; 113-182; 
I43B-2S9.4. 

SECTION .0300 - SHELLFISH LEASES AND 
FRANCHISES 

.0311 CANCELLATION 

(a) In addition to the grounds established by 
G.S. 113-202, the Secretary will begin action to 
terminate leases and franchises for failure to 
produce and market at least 25 bushels of oysters 
and or clams per lease acre per year, averaged 
over the most recent three-year period after Jan- 
uary 1 following the second anniversary of an 
initial lease and throughout the term of a renewal 
lease. 

(b) Action to terminate a shellfish franchise 
shall begin when there is reason to believe that 
the patentee, or those claiming under him. have 
done or omitted an act in violation o( the terms 
and conditions on which the letters patent were 
granted, or have by any other means forfeited the 
interest acquired under the same. I he Division 
shall investigate all such rights issued m 
perpetuity to determine whether the Secretary 
should request that the Attorney General initiate 
an action pursuant to G.S. 146-63 to vacate or 
annul the letters patent granted by the state. 



5:7 NORTH CAROLINA REGISTER July 2, 1990 



488 



PROPOSED RULES 



(c) In the event action to terminate a lease w 
Iranchi- e is begun, the owner shall be notified by 
registered mail and given a period of 30 days in 
which to correct the situation. Petitions to re- 
view the Secretary's decision must be filed with 
the Office oi Administrative Hearings consistent 
with the provisions of 26 NCAC Chapter 3. The 
owner may appeal the Secretary's decision to 
terminate to the Marine Fisheries Commission 
as set out in G.S. 113-202(p). 



Statutory 
143B-289A 



Authority G.S. 113-134; 113-201; 



Ml IF 18 - SFCRFI ARY OF SI A IF 

i V oticc is hereby given in accordance with G.S. 
1 SOD- 12 that the Department of Secretary of 
Stale. Corporations Dhision intends to amend 
mles cited as IS NCAC 4 .0101 - .0/02. .0205 - 
.0206, .0302 - .0303. .0305 - .0308. .0311 - .0314. 
.0401 - .0402. .0501 - .0504; adopt rules cited as 
IS NCAC 4 .0316 and repeal ndes cited as IS 
NCAC 4 .030/. .03/0. .03/5. 

1 he proposed effective date of this action is No- 
vember I. 1990. 

1 he public hearing will be conducted at 10:00 
a.m. on August 7, 1000 at Department of Secre- 
tary of State. 500 North Salisbury Street. Room 
302, Raleigh. North Carolina 2^603-5909. 

C ommcnl Procedures: Any interested person 
may present written comments for consideration 
by the Corporations Division. The hearing record 
will remain open for receipt of comments from 
July 3. 1000. through August 7, 1000. Written 
comments should be received by the Dhision by 
midnight on August 6, 1000. to be considered as 
part of the hearing record. Comments should be 
addressed to: 

Jerry D. Daniel 

Director 

Office of Secretary of Slate 

Corporations Division 

300 North Salisbury Street 

Room 302' 

Raleigh. North Carolina 2~603-5909 

Any person may present oral comments at the 
hearings. Requests to speak should be presented 
in writing to Mr. Daniel at the above address no 
later than five days before the date of the respec- 
tive hearing. Additional comments may be al- 
lowed by the Division by sign up at the public 



hearing as time a/lows. All presentations will be 
limited to 5 minutes. No fiscal note has been 
prepared pursuant to G.S. I50B-1 1(3) in con- 
nection with these proposed changes to the ad- 
ministrative rides of the Division, as the proposed 
changes will not require the expenditure or dis- 
tribution of state funds. 

CHAPTER 4 - CORPORATIONS DIVISION 

SECTION .0100 - GENERAL PROVISIONS 

.0101 LOCATION AND HOI RS 

The corporations Division of the Department 
of the Secretary of State is located in Room 302. 
I esislative Office Buildina, 300 North Salisbury 
Street. Raleigh. NC 276 fl. 2761)3-5000. The 
hours of the Division are ~^W S:0() a.m. until ^4U 
5:00 p.m. Monday through Friday excepting legal 
holidays. 

Statutory Authority G.S. 55-/ -30. 

.0102 ADMINISTRATION AND FUNCTIONS 

(a) The Chief Officer of the Division is the 
( 'orporations Attorney. Director. 

(b) The Division is responsible for tiling and 
maintaining charter documents on behalf of cor- 
porations and limited partnerships whenever til- 
ing with the Secretary of State is specified by 
statute. 

(c) The Division prepares and certifies copies 
of documents on file upon request. Statutory 
fees are charged for preparation and certification. 

(d) The Division provides information in re- 
sponse to written or telephone inquiry, based on 
inlormation contained in documents on file. 
There is no fee for providing information by 
telephone or letter. 

(e) The Division certifies to facts contained in 
documents on file, based on an examination of 
its documents and indices. 

l-ff T4»e division (+1*^ rf+>4 maintains application" 
*h4 giant ', certificates t*f authority k** foreign 
corporations to transact bii '. iiu" .-. t++ &i§ state - . 
■14 fi+c-. d++4 maintains .. upplementan . document -. 
tH+ bc - hall t-4 such corporations h+ accordance 
V i ith applicable statutes. 

t-e4 44+e dp . i"ion l '.'. ui ' " certificate ', ©f sU '. pen '. ion 
w+4 certificates ef reinstatement t+f corporation '. 
h* accordance v , ith applicable - statutes. 



Statutory Authority G.S. 55-1-22: 
55-1-30; 55A-5; 55A-S1; 59-206. 



55-1-25: 



SECTION .0200 - P VYMENT OF FFES AND 
TAXES 

.0205 OVERPAYMENT 



4S9 



5:7 NORTH CAROLINA REGISTER July 2, 1990 



PROPOSED RULES 



If the Corporations Attorney Director deter- 
mines that an overpayment of tax or fees by 
check or money order is so large that it is not in 
the interest of the state to issue a refund, he shall 
require tender of the exact amount of tax or fees 
prior to filing, preparation of copies, or certif- 
ication. 

Statutory Authority G.S. 55-1-30; 55A-81. 

.0206 DOCUMENTS NOT SPECIFICALLY 
PROVIDED FOR 

When any document is filed for any corporation 
organized under a statute other than one found 
in G.S. Chapter 55 or 55A, and no fee is specif- 
ically provided in the applicable statute, the fee 
or tax for such filing shall be the fee or tax pro- 
vided in G.S. 55 155; GS, 55 156; 55-1-22; G.S. 
55A-77; or G.S. 55A-78 for a comparable type 
of document, and if no comparable type of doc- 
ument exists, the fee shall be the fee provided in 
G.S. 55 155(a)(2H) 55- l-22fa)(26) or G.S. 
55A-77(a)(17). 

Statutory Authority G.S. 55-1-22; 55A-77; 
55A-78. 

SECTION .0300 - FILING OF DOCUMENTS 

.0301 GENERAL. PROVISIONS (REPEALED) 

Statutory Authority G.S. 55-16S; 55-170; 55A-SI: 
55A-83; 55B-I3; 105-230; 105-232. 

.0302 EXECUTION 

fa-)- When execution is required by a person h* 
any capacity, a docum e nt which do e * Bet indi 
errfe tbat- (4*e e x e cution it- contain -, i* m the ca- 
pacity required shall be rejected. 

(4*4 When execution is required by any person 
acting in the capacity of officer, director, 
incorporator, or registered agent, execution by a 
holder of a power of attorney, b^ a personal 
representative, or bv a legal guardian of the per- 
son shall be rejected. 

ft-f When execution f** required by h+h- person 
i» tbe capacity «+ shareholder, execution by- 
hold e r h+ power &£ attorney t+f proxy, personal 
representative, t-H 1 l e gal guardian h+ the person 
shall be accepted. 

Statutory Authority G.S. 55-/ -20; 55-/ -30; 
55 A -4; 55A-81. 

.0303 REJECTION 

If the Corporation '. Attorney Director finds that 
a document submitted for filing pursuant to a 
provision ot Chapter 55A or Chapter 5'> does not 
conlorm to law in any respect, he shall by return 



mail or other appropriate method remit the doc- 
ument and fee submitted to the person who 
submitted same, such document, accompanied 
by a recitation, an explanation, in adequate de- 
tail, of the deficiency. The date of filing of such 
document shall be the date upon which the doc- 
ument is received filed by the Division in such 
form as shall conform to law. 

Statutory Authority G.S. 55A-4; 55A-81; 59-206. 

.0305 CORRECTIVE FILINGS - NONPROFIT 
CORP AND LIMITED PARTNERSHIPS 

(a) Any error in the name of the registered 
agent or the location of the registered office 
which appears in any document which has been 
filed bv or on behalf of a nonprofit corporation 
may be corrected by tiling statement of change 
of registered office or registered agent. 

(b) Subject to Paragraph (a) of this Regulation, 
Rule, any error in the articles of incorporation 
of a nonprofit corporation which have been tiled 
shall be corrected only by filing articles of 
amendment. 

(c) Subject to Paragraph (a) of this Regulation, 
Rule, any error in a restated charter of a 
nonprofit corporation which has been filed shall 
be corrected only by tiling a restated charter. 

(d) Subject to Paragraph (a) of this Regulat i on, 
Rule, any error in articles of merger or consol- 
idation of nonprofit corporations which have 
been filed shall be corrected only by tiling articles 
of amendment executed only by the surviving or 
new corporation, only. 

(e) Subject to Paragraph (a) of this Regulation, 
Rule, any error in an application for a certificate 
of authority which has been filed bv or on behalf 
of a foreign nonprofit corporation shall be cor- 
rected only by filing an application for an 
amended certificate of authority. 

(f) An error m a certificate of limited partner- 
ship which has been filed by or on behalf of a 
domestic limited partnership or m an application 
for registration which has been filed bv a to reign 
limited partnership shall be corrected only bv the 
filing of an amended certificate ot limited part- 
nership or an amended application tor legistra- 
tion. 



(_gj ffy In any case w here m which there is an 
error in any document which has been tiled by 
or on behalf of a North Carolina nonprofit cor- 
poration and for which the manner of correction 
is not specified in Paragraphs (a) k+ through (c) 
of this Regulation, Rule, the only methods of 
correcting such error shall be either: 

( 1 ) filing a document pursuant to the same 
statute pursuant to which the filing con- 
taining the error was made, or 



5:7 NORTH CAROLINA REGISTER July 



1990 



490 



PROPOSED RULES 



(2) filing articles of amendment 
m e nt conta i ning toe error 



4 -the 4* 



executed 

by- oo4 f4e4 oo behalf of » North Carolina 
corporal i on. 
(h) (g) No document filed to correct an error 
shall make reference to the error or to 
"correction" or "corrected" in its caption, but 
such error may be recited elsewhere in the docu- 
ment. 

Statutory Authority G.S. 55A-S1; 59-202; 59-905. 

.0.106 ARTICLES OF INCORPORATION 
- NONPROFIT CORPORATIONS 

f*f Wh e n shar e s *fe authorized V i hich hav e oo 
oof ' l ahiL'. oo statement '' hall be included h+ arti 
eles of incorporation v , hi eh gives em aggregate 
dollar amount of authorized capital. 

FO+ I nless articles of incorporation authoriz e 
■ har e-, of ho pof wilne, minimum amount of 
consideration -hall be oo feot than 4fe least fmf 
valiiL ' i-4 etftv -ingle share of *oy- cla-- of '. hare '. 
authoriz e d. 

fe4 Cu The address of each director -and 
incorporator and the address of the registered of- 
fice in articles of incorporation shall contain a 
street address if the address lists a city with a 
population of 5,000 or more persons according 
to the latest U.S. Census. In am instance where 
street address is required, name of building, rural 
route number, or name of road or street shall be 
accepted in lieu of street address, but post office 
box number alone shall not be accepted. 

fo+ fb| Articles of incorporation which contain 
bylaws or in which bylaws are incorporated by 
reference shall be rejected. Reference may be 
made in articles of incorporation to bylaw pro- 
visions so long as such provisions are not thereby 
incorporated in the charter. 

o>+ Article -'. ef incorporation til e d pursuant to 
G.S. xv\ ~i '. hall contain -om e spec i fic stateaeat 

of p i ltpO '. l ' FO addition tO HOV- gJUlTal Of : -o4 

purpose" clause ao4 m addition to statement- 
wh i ch haw fbe effect only of limiting purpose to 
to* e xempt actp . itie-. 

(4+ Cm Articles of incorporation filed pursuant 
to G.S. 55A-7 shall list names and addresses of a 
minimum ot three initial directors. 

Statutory Authority G.S. 55-2-02: 55A-7; 55 . 1- 20. 

.0.107 AI'IM l( 'VI ION l()li RESERVATION OF 
CORPOR VIE NAME 

(a) It applicant requests reservation of more 
than one corporate name, a separate application 
shall be submitted for each name. 

(b) The date of tiling shall be the first day in 
determining the date of expiration of reservation. 



fof 90 days. The reservation shall expire imme- 
diately after the termination of filings by the Di- 
vision on the ninetieth final day of the reservation 
period. If the ninetieth final day of the reserva- 
tion period is not an operating day of the Divi- 
sion, the reservation shall nevertheless expire on 
toe ninetieth such final day. A reservation of toe 
'■ ame name may be filed by- toe -. ant e party of oo 
behalt of toe '. am e party, if toe name i* then 
available. *t tmy tim e subs e quent to toe termi 
nation of filing ', oo toe of-* operating doy- of toe 
disi '. ion '. ub '. equent to toe expiration of t-oe OFe- 
viiHi'i reservation. 

(c) A person who wishes to reserve a particular 
corporate name alter having reserved that name 
on a previous occasion may apply to reserve such 
name again alter the elapse of one lull business 
day following the expiration of the previous res- 
ervation. 

Statutory Authority G.S. 55-4-02; 55A-/0. 

.0308 REGISTERED OFFICE AND 
REGISTERED AGENT 

(a I In the event that a corporation has never 
designated a registered office or registered agent. 
or in the event that the registered agent has re- 
signed, the corporation m.iv designate a registered 
agent and or registered office. 

lb ) (o* The tee tor filing a designation shall be 
the fee specified in G.S. ro 155(u)(2") 

55- 1 - 22( a )(<>) or G.S. 55A-77(a)(17), as applica- 
ble. 

(4h D e signation frov- be f4e4 oofy io toe io- 
■. tance pros ided fo G.S. 55 15 ( h) of G.S. 
55 A 11(b) of wh e n registered agent fho resigned. 

(c) Change may be filed v , hen registered agent 
ho* resigned. Change may oot be ti 1 ed ff> toe 
instanc e provided fo G.S. 5 5 15(b) of G.S. 
5\\ 1 1(b ) . The information required for the 
designation of a registered agent or a registered 
office shall be set forth in a statement which shall 



be substantially the same as that provided tor in 
Ci.S. ss-s-M2. G.S 55-15-os. C'i.S. 55A-12. or 
G.S. 55A-C\ except that it shall he urmcccssarv 
to set l.orth lnlonriation concerning the current 
registered agent or current registered office. 
( d ) A designat i on shall be ift * form ident i cal 



te 



4 of G4-4 55A 12 e*- 
■ 'designation" of 



toot- provided fo G.S. oo- 

eef4 toot- toe words 
designat e d" shall be substituted fof toe v , ords 
chang e " of changed v . here those Vi ords ao- 

p e ar. With respect to documents permitted to 

be filed with the Uffice of the Secretarv of State. 



a person shall consistently use the same name 
and same business oltice address m each instance 
i_n which that person serves as registered agent tor 
anv corporation. 



491 



5:7 SORTH CAROLISA REGISTER July 2, 1990 



PROPOSED RULES 



(e) A person who serves as registered agent for 
more than one corporation may notify the Sec- 
retary of State of the change of the address of the 
registered offices of such corporations by attach- 
ing a list of the names of those corporations to 
the statement required to he filed by G.S. 55-5-1)2 
or G.S. 55-15-1)8. 

Statutory Authority G.S. 55-1-22; 55-1-30; 
55-5-01; 55-5-02; 55-/5-07; 55-/ 5-08; 55.4-1 1; 
55A-12; 55.4-65; 55A-75; 55A-77; 55.4-81. 

.0310 TAX ON FILING DOC WHICH INCREASE 
AUTHORIZED CAPITAL (REPEALED) 

Statutory Authority G.S. 55-147; 55-148; 55-156. 

.031 1 ART OF MERGER/SHARE EXCH 

PI RSI AN I TO G.S. 55-1 1-07 OR 55A-42.I 

(a) Article' ' ; t-4 merger betweea domestic a«4 
foreign corporation *! '. hall be executed by each 
corporation which is a party k+ tke merger. Each 
foreign corporation which is a party to a merger 
or a share exchange pursuant to G.S. 55- 1 1-07 
or G.S. 55A-42. 1 shall be identified in the articles 
of merger or share exchange by state or country 
of incorporation. Articles of merger filed pursu- 
ant to G.S. 55 1 1 1 55-11-07 or G.S. 55A-42.1 
shall contain: 

(1) a statement that the merger is permitted by 

the law o\_ the state or country of incor- 
poration of each foreign corporation 
which is a party, and 

(2) a statement that each foreign corporation 
which is a party has complied or shall 
comply with the applicable laws of its 
state or country of incorporation regard- 
ing such merger. 

(b) filing pursuant to G.S. 55 1 1 1 55-1 1-07 
or G.S. 55A-42.1 shall have the same effect as 
filing pursuant to G.S. 55 150 55-15-20 or G.S. 
55A-72 for any foreign corporation which has 
authority to transact business in this state, which 
is a party to such merger, and which is not the 
surviving corporation. 

Statutory Authority G.S. 55-/1-07; 55A-42.1. 

.0312 APPL FOR CERT OF AUTHORITY BY 
FOREIGN PROF CORPORATION 

f*> Appl i cation ft->+ cert i ficate * t4' authority '. hall 
contain >. oinc ' .. pecif i c statement el purpose m- 
add i tion k+ emy general t-v* '-&U purpo *. e" clause 
included h+ t+H* application. 

fb} Ref e rence h+ application t# purpos e m- t4+e 
charter tr>+ tbe corporation *. hall fte* be accepted 
utile ' ' .' .' , enough extra cop i e" . t-4 dialler, •+► addition 
to t+te certified copy requ i red by G.S. 55 I3*), afe 



provided to- attach k* each copy ef- (4h» applica 

fe} If a«y a foreign corporation which renders 
professional services as defined in G.S. 55l?-2(6) 
applies for a certificate of authority, by a» appli 
cation which lists as its purpor . e the rend e ring &( 
profcv .'. ional *. ervicc *» j a* defined m G.S. 551? 2(6), 
each copy of such application shall be accompa- 
nied by a certificate of the applicable North 
Carolina licensing board, making the same cer- 
tification as is required for articles of incorpo- 
ration pursuant to G.S. 55B-4(4). This 
requirement shall not apply to any corporation 
which was organized prior to June 5, 1969, and 
was permitted by the law of its jurisdiction of 
incorporation to render such services prior to 
June 5, 1069. 

Statutory Authority G.S. 55-/5-03: 55B-2; 55B-4; 
55B-15. 

.0313 FILING MERGER INVOLVING FOREIGN 
CORPORATION 

(a) If one or more parties to a merger filed 
pursuant to G.S. 55 1 IS ©f Gt&t 55A-70 is a 
domestic corporation, the filing of articles of 
merger pursuant to G.S. 55 10U aw4 GrS^ 55 1 1 1 
e* G^v 55A-41 and (i.S. 55A-42.1 shall take 
place prior to or *i imultan e ou *. k+ simultaneously 
with the filing of articles of merger pursuant to 
G.S. 55 118 ef GtSt 55A-70. 

(b) filing The filing of articles of merger pursu- 
ant to G.S. 55 MX, G4*r 55A-70 G^vr 55 Km, 
or G.S. 55A-41 shall be deemed a substitute for 
an shall have the same effect as the filing of an 
application for withdrawal pursuant to G.S. 
55 l 50 e* G-4vr 55 A 83 fc* 55 A -72 bv any foreign 
corporation which has authority to transact 
business in this state, which is a party to such 
merger, and which is not the surviving corpo- 
ration. 

(c) If a foreign corporation has been authorized 
authority to transact business in this state and is 
a non-surviving party to a statutory merger, the 
filing under G.S. 55 MX of the articles of merger 
by the surviving corporation shall be accepted bv 
the Division with the s i me effect as the equiv- 
alent of a tiling pui '. uant k* G.S. 5 5 1 50 b* (.i.S. 
55A ll, of an application for withdrawal, even if 
the surviving corporation doc . R++t have authority 
has not been authorized to transact business in 
this state. 

Statutory Authority G.S. 55.4-41; 55.4-42.1: 
55A-70; 55A-72; 55.1-8/. 

.0314 FILING EVIDENCE OF DISSOU HON 
OF FOREIGN NONPROFIT CORP 



->:/ 



NORTH CAROLINA REGISTER July 



1990 



492 



PROPOSED RULES 



filing The filing of a copy of any final docu- include only such beginning document, all sub- 



ment of dissolution bearing an original certif- 
ication of the appropriate official of the state or 
countr>' of incorporation shall be deemed a sub- 
stitute for and shall have the same effect as the 
filing of an application for withdrawal pursuant 
to G.S. 55 LSD m <r*^ 55A-72. 

Statutory Authority G.S. 55A-72; 55A-81. 

.0315 FILING PURSUANT TO G.S. 55-164.1 
(REPEALED) 

Statutory Authority G.S. 55-164.1. 

.0316 FORM FOR ANNUAL REPORT 

A corporation filing its annual report in order 
to comply with G.S. 55-16-22 must use the an- 
nual report form promulgated by the Secretary 
of State. Exact copies of the annual report form 
provided by the Corporations Division may be 
made and used to satisfy the annual filing re- 
quirement. However, annual reports with for- 
mats different for the form prescribed by the 
Corporations Division will not be accepted for 
filing. 

Statutory Authority G.S. 55-1-21 . 

SECTION .0400 - CERTIFICATIONS 

.0401 DOCUMENTS 

(a) Copies of documents tm fi4t» filed with re- 
spect to a nonprofit corporation may be certified 
as charter documents only if such copies begin 
chronologically with articles of incorporation or 
other document of incorporation, latest restated 
charter, or the latest articles of amendment or 
articles of merger purporting to rewrite the char- 
ter in its entirety. If requested, the copies to be 
certified as charter documents shall include only 
such beginning document, all subsequent articles 
of amendment, and all subsequent articles of 
merger. If not otherwise requested, copies to be 
certified as charter documents certification *s 
clunlcr dot uinent ' j shall begin chronologically 
with the latest restated or rewritten charter and 
shall include all subsequent documents on file. 

(b) Copies of documents filed with respect to 
corporations subject to the provisions of Chapter 
55 mav be certified as the articles of incorpo- 
ration of such corporation only if such copies 
begin chronologicalh with the articles of incor- 
poration or other documents of incorporation. 
the latest restated articles of incorporation, or the 
latest articles of amendment or articles of merger 
purporting to rewrite the corporation's articles 
of incorporation in their entirety. U requested, 
the documents requested to be so certified shall 



sequent articles of amendment, and all subse- 
quent articles of merger. If not otherwise 
requested, such documents to be certified shall 
begin chronologically with the latest restated or 
rewritten articles of incorporation and shall in- 
clude all related documents subsequently filed. 

(c) When certification of a certificate of limited 
partnership of a domestic limited partnership or 
a certificated of authority of a foreign limited 
partnership is requested, such certification shall 
include the original certificate of limited partner- 
ship or certificate of authority and all amend- 



ments or changes thereU 



Statutory 
59-206. 



Authority G.S. 55-1-30; 55A-8I; 



.0402 CERT OF FACTS/CERT OF EXISTENCE 
/AUTHORIZATION 

(a) No certification of facts, certificate of exist- 
ence, or certificate of authorization shall contain 
information relating to more than one corpo- 
ration unless such information pertains to a 
merger to which such corporations were parties. 

(b) The fee for each certificate of existence or 
certificate of authorization for corporations sub- 
ject to t_he provisions of Chapter 55 shall be the 
fee specified in G.S. 55- 1-22. for corporations 
subject to the provisions of C hapter 55 A, the fee 
for each certification of facts t*p e ach copy thereof 
shall be the fee specified in G.S. 55 155(a )( 2S> 
ef Gr&r 55A-77(a)(15) for affixing certificate and 
seal, for limited partnerships, the fee for each 
certified document shall be the fee specified in 
(i.S. 5 t >-110r>(7). 



Statutory Authority G.S. 
55 A - 77; 55 A -81; 59- I 106. 



55-1-22; 55-1-30; 



SECTION .0500 - CORPORATE NAME 

.0501 GENERAL 

(a) The Secretary of State expressly reserves the 
right pursuant to G.S. 55 12, 55-4-01. G.S. 
55A-10, G.S. 55 137, 55-15-06, G.S. 55A-60, or 
any other applicable statute, to reject filing ot any 
document conferring a corporate name, if he de- 
termines that such corporate name is contrary to 
law. 

(b) 44+e With respect to corporations subject to 
the provisions of Chapter 55. \, the Secretary ot 
State shall accept consent ot a corporation with 
a L ' imilur name similar to the proposed name 
proposed to be used by another corporation onlv 
as onlv one factor in determining whether a such 
proposed name is contrary to law, and shall make 
his determination based upon all the circum- 



49.1 



5:7 NORTH CAROLINA REGISTER July 2, 1990 



PROPOSED RULES 



stances as they appear, when the proposed name 
is submitted, in accordance with the applicable 
statu e s, statutes. The Secretary' of State, rasefves 
the right k+ proceed with filing a name which 
would otherwis e be deceptively similar upon re- 
ceipt of such a consent, may allow the use of 
such a proposed name, but shall not permit the 
use of a m* name which is the same as a» existing 
a name shall be permitted, which is reserved or 
registered or which has been approved for use at 
that time. Should the use of a name which is 
identical to one which is reserved or registered 
or which has been approved for use same name 
be granted by error, the Secretary of State shall 
charge no tax or fee for tiling articles of amend- 
ment to correct such error. 

(c) Without limiting tbe nght frf tbe Secret a ry 
«£ State t++ r e ject a corporate name which is 
contrary k» k-Wr tbe following regulat i ons w- 
garding corporate name aw hereby adopted . 
When a corporation applies to the Secretary' of 
State for authorization to use a name which is 
not distinguishable upon his records trom names 
described in Ci.S. 55-4-0 1(h) or Ci.S. 5> 1 5-06(h), 
and provides the consent of another corporation 
to such use, the undertaking required of the 
consenting corrjoration b\ Ci.S. 55-4-01(c)( 1 ) or 
bv G.S. 55- 13-1 )r»(c)( 1) shall consist of the con- 
senting corporation's amendment to the appro- 
priate document tiled with the division effecting 
a change of that corporation's name to a name 
distinguishable on the records of the Secretary of 



State from the namt 



i<ght to be used bv the 



apph ing corporation. 

Statutory Authority G.S. 55-4-01; 55-15-06; 
55,1 - 10; 55 A -60; 55 A -57 . 

.0502 WORDS PROHIBITKD IN ADDITION TO 
STATUTORY PROHIBITIONS 

(a) The weirds "engineer" or "engineering" »f 
"engineered," or their derivatives shall not be in- 
cluded in the corporate name for a corporation 
unless it is organized pursuant to G.S. Chapter 
55B or, if it is a foreign corporation, unless it 
complies with Rule .0312(c) of this Chapter. 

(b) The words "surveyor." "survey," "survey- 
ing," or their derivatives shall not be included in 
the corporate name for a corporation unless it is 
organized pursuant to Ci.S. Chapter 5513 or. if it 
is a foreign corporation, unless it complies with 
.0312(c) of this Chapter, provided that the words 
specified shall not be prohibited in any case 
where such words arc modified by another word 
or words in such manner as to indicate activity 
other than land surveying. 

(c) The words "architecture," "architectural," 
"architect," or their derivatives shall not be in- 



cluded in the corporate name for a corporation 
unless it is organized pursuant to G.S. Chapter 
55B or, if it is a foreign corporation, unless it 
complies with .0312(c) of this Chapter, provided 
that the words specified shall not be prohibited 
in any case where such words are modified by 
another word or words in such manner as to in- 
dicate activity other than design of structures. 

(d) The word "co-op" shall not be included in 
the corporate name of a corporation unless it is 
organized or domesticated pursuant to G.S. 
Chapter >4 Subchapter Vr 55-139. 

fe} '4-be following words shall f+H+ b# included 
i» a corporate name: "army." "navy," 

"airforce," "coast guard," "mail." "postolfice," 
t+f "postal." 

ff4 (e| When a document is submitted conferring 
a corporate name containing the word "whole- 
sale," unless the purpose clause of the document 
indicates clearly that the corporation shall not 
engage in retail sales, the Corporations Attorney 
shall not file the articles unless he finds, pursuant 
to written assurance by the principals or their 
attorney, that the corporation shall comply with 
G.S. 75-29. 

(g) (_Q The corporate name for a business cor- 
poration shall not contain the word "realtor." 

(-b+ (_gj_ The corporate name for a business cor- 
poration shall not contain the word "insurance" 
followed directly by a corporate ending or the 
word "insurance" followed directly by a ge- 
ographical designation and a corporate ending. 

Statutory Authority G.S. 54-15'); 55-4-01; 
55A-I0. 

.050? DECEPTIVELY SIMILAR AND 
DISTINGUISHABLE NAMES 

(a) A proposed corporate name proposed to 
be used bv a corporation subject to the pro- 
\ isions of Chapter 55A shall not be permitted 
where it begins with two or more words which 
are the same as an existing corporate name w here 
the only substantial difference between the two 
names is the addition or deletion of another word 
such as "services", "sales", "associates", "indus- 
tries", "enterprises", or any other word which 
does not indicate the type of business to be pur- 
sued by the corporation. 

(b) A propo -. ed corporate name proposed to 
be used b v a corporation subject to the pro- 
\ isions o[ ( haptcr 55 \ shall not be permitted 
where the only substantial difference between it 
and an existing corporate name is the addition 
or deletion of a geographical designation, unless 
such geographical designation added is the name 
of a city or count)' other than the city or county 
of the then registered office ol the existing cor- 



5:7 NORTH CAROLINA REGISTER July 2,1990 



494 



PROPOSED RULES 



porution, or the geographical designation deleted 
is the name of a city or counts other than the city 
or counts of the registered office of the proposed 
corporation. This provision is subject to G.S. 
35 l37 im4G^ 55A-60. 

(c) Corporat e ending '. «« Words indicating 
corporateness. such as "company", "co.", 
limited, "ltd.", "corporation", "corp.", "incorpo- 
rated", "inc.", "professional association", and 
"pa." Corporate onctingf . shall be disregarded in 
determining if a proposed corporate name is dis- 
tinguishable upon the records of the Secretary of 
State (in the case of a corporation subject to the 
provisions of Chapter 55) or permissible (jn the 
case of a corporation sub|ect to Chapter 55A). 
provided that such words appear at the end of the 
proposed corporate name. Such words shall not 
be disregarded m such dctennination when they 
appear m the bod v. rather than at the ending, of 
the proposed corporate name. 

(d) Word ?. Mich as "the." "and." "a." "of." 
for." *s w^H- rt- t41 punctuation, including hy- 
phen, apostrophe followed by letter ^^^r 11 a* w-t4i 
a± lingular t+f plural I'onn t4" * pailicular word, 
• Tall be disregarded » determining v . h e th e r a 
particular nam e » permissible. Articles, con- 
junctions prepositions, singular or plural forms 
o( a particular word, punctuation, spaces, and the 
substitution <M an Arabic numeral lor a word 
shall be disregarded m determining whether a 
proposed corporate name is distinguishable upon 
the records of the Secretary of State or otherwise 
permissible lor use in a proposed corporate 
name. 

Statutory Authority G.S. 55-4-0/: 55A-/0. 

.05(14 FILING RCTITIOl S OR ASSUMED 

NAME FOR FOREIGN CORPORATION 

(a) A foreign corporation whose corporate 
name contains a word which is prohibited by 
statute or by Rule .0502 of this Chapter shall 
agree to use an assumed or fictitious name m iks 
■■ a me manner as provided in G.S. 5 5 1 5 7 
55-15-06 or G.S. 55A-60. 

(b) A foreign corporation which has been 
granted authority to transact business m this 
State and which desires to add to or delete from 
an assumed name or to adopt a fictitious name 
in order to avoid & conflict *+f because *->+ remo' i al 
t4 or remove a conllict over the use of a name. 
t*f which desires to change its assumed or ficti- 
tious name, shall file pursuant to G.S. 55 1 N 
55- 15-04 or G.S. 55A-71. 

(c) No assumed or fictitious name shall be 
lifted t+H- tTr* indices t-4 tiled with the Division t*f 
m rtm- docuiiK ' iit t+W unless required by (a) t+f 



th^. Rule. GtJ^t 55 157. eh= G-^ 55A M ) . statute 
or administrative rule. 

Statutory Authority G.S. 55-/5-04; 55-/5-06; 
55.4-60; 55A-71. 

****************** 



1\ oticc is hereby given in accordance with G.S. 
150B-I2 that the Department of Secretary of 
State, Securities Division intends to adopt rule(s) 
cited as 18 NCAC 6 J 2/0. 



Th 



he proposed effective date of this action is No- 
vember I. 1990. 

1 he public hearing will be conducted at 10:00 
a.m. on August 15, 1990 at Department of Secre- 
tary of Slate, Securities Division, 300 N. Salisbury 
St'. - Room 404, Raleigh. NC 27603-5909. 

C omment Procedures: Any interested person 
may present written comments for consideration 
by the Securities Division. The /tearing record 
will remain open for receipt of comments from 
July 3. 1990, through August 15, 1990. Written 
comments should be received by the Division by 
midnight on August 14. 1990, to be considered as 
part of the hearing record. Comments should be 
addressed to: 

Stephen M. U'allts 

Deputy Securities Administrator 

Office of Secretary of State 

Securities Division 

300 N. Salisbury St. 

Room 404 

Raleigh, NC 27603-5909 

Any person may present oral comments at the 
hearings. Requests to speak should be presented 
in writing to Mr. Wallis at the above address no 
later than five days before the date of the respec- 
tive hearing. Additional comments may be al- 
lowed bv the Division by sign up at the public 
hearing as lime allows. All presentations will be 
limited to five minutes. No fiscal note has been 
prepared pursuant to G.S. 1 50B-1 1 ( 3 1 in con- 
nection with this proposed change to the adminis- 
trative rules of the Division, as the proposed 
change will not require the expenditure or distrib- 
ution of State funds. 

CHAPTER 6 - SECURITIES DIVISION 
SECTION .1200 - EXEMPTIONS 



495 



5:7 \ORTH CAROLI.XA REGISTER July 2, 1990 



PROPOSED RILES 



.1210 SKCl Kl t IKS EXCIIGS/AUTO 
QUOTATION SYS APPROVED/ 
ADMINISTRATOR 

For purposes of G.S. 78A- 16( 1 5), the following 
securities exchanges and automated quotation 
systems are approved provided such exchanges 
or systems comply with the provisions of Para- 
graphs ( 1 ) through (4) of the Memorandum of 
Understanding regarding a Model Uniform Mar- 
ketplace Exemption From State Securities Reg- 
istration Requirements |SFC Release 33-6S10 
(December 16, 1988), CCII NASAA Reports, 
par. 11,120]: 

( 1) New York Stock Exchange, 

(2) American Stock Exchange, 

(3) Pacific Stock Exchange. 

(4) Midwest Stock Exchange, 

(5) NASDAQ National Market System. 

Statutory Authority G.S. 78A-16(15). 

TITLE 21 - OCCUPATIONAL LICENSING 

BOARD 

i V otice is hereby given in accordance with G.S. 
I SOB- 12 that the North Carolina Board of Nurs- 
ing intends to repeal nile(s) cited as 21 SCAC 
36 .0222; and adopt rule(s) cited as 21 SCAC 
36 .0224 - .0225. 



1 he proposed effective date of this action is No- 
vember I, 1990. 

1 he public hearing will be conducted at 4:00 
p.m. on August 16, 1990 at North Carolina Board 
of Nursing Office. 3724 National Drive, Suite 201, 
Raleigh, NC 27612. 

C omment Procedures: Any person wishing to 
address the Board relevant to proposed rules 
should notify the Board by noon on August 15. 
1990, register at the door the day of the hearing, 
and present the Hearing Officer with a written 
copy of the oral testimony. Oral testimony will 
be limited to three minutes per speaker. Written 
comments only should be directed, five days prior 
to the hearing date, to the N.C. Board of Nursing, 
P.O. Box 2129, Raleigh, NC 27602. 

CHAPTER 36 - BOARD OF NURSING 

SECTION .0200 - LICENSURE 

.0222 COMPONENTS Of NURSING PRACTICE 
(REPEALED) 

Statutory Authority G.S. 90-17 1.20(7), (8); 
90-17 1.23(b). 



.0224 COMPONENTS OK Nl RSING PRACTICE 
FOR IMF REGISTERED NURSE 

(a) The responsibilities which any registered 
nurse can safely accept are determined by the 
variables in each nursing practice setting. These 
variables include: 

(1) the nurse's own qualifications including: 

(A) basic educational preparation; and 

(B) knowledge and skills subsequently ac- 
quired through continuing education and 
practice; 

(2) the complexity and frequency of nursing 
care needed by a given client population; 

(3) the proximity of clients to personnel; 

(4) the qualifications and number of staff; 

(5) the accessible resources; and 

(6) established policies, procedures, practices, 
and channels of communication which 
lend support to the types of nursing ser- 
vices offered. 

(b) Assessment is an ongoing process and 
consists of the determination of nursing care 
needs based upon collection and interpretation 
of data relevant to the health status of a client. 

( 1 ) Collection of data includes: 

(A) obtaining data from relevant sources 
regarding the biological, psychological, 
social and cultural factors of the client's 
life and the influence these factors have 
on health status, including: 

(i) observations of appearance and be- 
havior; 

(ii) measurements of physical structure 
and physiological functions; 

(iii) information regarding available re- 
sources; and 

(B) verifying data collected. 

(2) Interpretation of data includes: 

(A) analyzing the nature and inter- 
relationships of collected data; and 

(B) determining the significance of data to 
client's health status, ability to care for 
self, and treatment regimen. 

(3) Formulation of a nursing diagnosis in- 
cludes: 

(A) describing actual or potential responses 
to health conditions. Such responses are 
those for which nursing care is indicated, 
and or for which referral to medical or 
community resources is appropriate; and 

(B) developing a statement of a client 
problem identified through interpretation 
of collected data. 

(c) Planning nursing care activities includes 
identifying the client's needs and selecting or 
modifying nursing interventions related to the 



5:7 NORTH CAROLINA REGISTER July 2, 1990 



496 



PROPOSED RULES 



findings of the nursing assessment. Components 
of planning include: 

( 1 ) prioritizing nursing diagnoses and needs; 

(2) setting goals and outcome criteria; 

(3) initiating or participating in multidiscipli- 
nary planning; 

(4) developing a plan of care which includes 
determining and prioritizing nursing 
interventions; and 

(5) identifying resources based on necessity 
and availability. 

(d) Implementation of nursing activities is the 
initiating and delivering of nursing care according 
to an established plan, which includes, but is not 
limited to: 

( 1 ) procuring resources; 

(2) actualizing nursing interventions and 
medical orders consistent with 21 NCAC 
36 .0221(c); 

(3) performing nursing interventions; 

(4) analyzing responses to nursing inter- 
ventions; 

(5) modifying nursing interventions; and 

(6) delegating to and supervising nursing ac- 
tivities of other licensed and unlicensed 
personnel consistent with Paragraph (a) 
and (i) of this Rule, G.S. 90-171.20 (7) d 
and i. and 21 NCAC 36 .0401. 

(e) Evaluation consists of determining the ex- 
tent to which desired outcomes of nursing care 
are met and planning for subsequent care. 
Components of evaluation include: 

( 1 ) collecting evaluative data from relevant 
sources; 

(2) anal\ zing the effectiveness of nursing 
interventions; and 

(3) modifying the plan of care based upon 
newly collected data, change in the client's 
status, and expected outcomes. 

(f) Reporting and Recording by the registered 
nurse are those communications required in re- 
lation to all aspects of nursing care. 

( 1 ) Reporting means the communication of 
significant information to other persons 
responsible for. or involved in. the care of 
the client. The registered nurse is ac- 
countable for: 

(A) directing the communication to the 
appropriate person! s) and consistent with 
established policies, procedures, practices 
and channels of communication which 
lend support to tvpes oi nursing services 
offered; 

(B) communicating within a time period 
which is consistent with the client's need 
for care; 

(C) evaluating the nature or responses to 
information reported; and 



(D) determining whether further commu- 
nication is indicated. 
(2) Recording means the documentation of 
all significant information on the appro- 
priate client record, nursing care plan or 
other documents. This documentation 
must: 

(A) be pertinent to the client's health care; 

(B) accurately describe all aspects of nursing 
care including assessment, planning, im- 
plementation and evaluation; 

(C) be completed within a time period 
consistent with the client's need for care; 

( D) reflect the communication of significant 
information to other-persons; and 

(E) verify the proper administration and 
disposal of controlled substances. 

(g) Collaborating involves communicating and 
working cooperatively with individuals whose 
services may have a direct or indirect effect upon 
the client's health care. The role of the registered 
nurse in collaborating in client care includes: 

( 1) initiating, coordinating, planning, and im- 
plementing nursing or multidisciplinary 
approaches for the client's care; 

(2) participating in decision-making and in 
cooperative goal-directed efforts; 

(3) seeking and utilizing appropriate resources 
in the referral process; and 

(4) safeguarding confidentiality. 

(h) leaching and Counseling clients is the re- 
sponsibilitv of the registered nurse, consistent 
with G.S. 90-171.20(7)g. 

(1) teaching and counseling consist of pro- 
viding accurate and consistent informa- 
tion, demonstrations and guidance to 
clients, their families or significant others 
regarding the client's health status and 
health care for the purpose of: 

(A) increasing knowledge; 

(B) assisting the client to reach an optimum 
level of health functioning and partic- 
ipation in self care; and 

(C) promoting the client's ability to make 
informed decisions. 

(2) teaching and counseling include, but are 
not limited to: 

(A) assessing the client's needs and abilities: 

(B) adapting teaching content and methods 
to the identified needs and abilities of the 
client (s): 

(C) evaluating effectiveness of teaching and 
counseling; and 

(D) making referrals to appropriate re- 
sources. 

(i) Managing the delivery of nursing care 
through the on-going supervision, teaching and 
evaluation of nursing personnel is the rcsponsi- 



497 



5:7 SORT II CAROLINA REGISTER July 2, 1990 



PROPOSED RILES 



bility of the registered nurse as specified in the 
legal definition of the practice of nursing and in- 
cludes, but is not limited to: 

(1) continuous availability for direct partic- 
ipation in nursing care, onsite when nec- 
essary, as indicated by client's status and 
by the variables cited in Paragraph (a) of 
this Rule; 

(2) assessing capabilities of personnel in re- 
lation to client status and plan of nursing 
care; 

(3) delegating responsibility or assigning 
nursing care functions to personnel quali- 
fied to assume such responsibility and to 
perform such functions; 

(4) accountability for nursing care given by 
all personnel to whom that care is deleg- 
ated; and 

(5) direct observation of clients and evaluation 
of nursing care given. 

(j) Administering nursing services is the re- 
sponsibility of the registered nurse as specified in 
the legal definition of the practice of nursing in 
G.S. 90-171.20 (7) i. and includes, but is not 
limited to: 

(1) identification of standards, policies and 
procedures related to the delivery of nurs- 
ing care; 

(2) planning for and evaluation of the nursing 
care delivery system; and 

(3) management of licensed and unlicensed 
personnel who provide nursing care con- 
sistent with Paragraphs (a) and (i) of this 
Rule and which includes: 

(A) defined levels of accountability and re- 
sponsibility within the nursing organiza- 
tion; 

(B) a mechanism to validate qualifications, 
knowledge, and skills of nursing person- 
nel; 

(C) provision of educational opportunities 
related to expected nursing performance; 
and 

(D) validation of the implementation of a 
system for performance evaluation. 

Statutory Authority G.S. 90-171.20(7); 

90-171. 23(b); 90-171.43(4). 

.0225 COMPONENTS OF NURSING PRACTICE 
FOR THE LICENSED PRACTICAL NURSE 

fa) The responsibilities for performing deleg- 
ated nursing activities which any licensed practi- 
cal nurse can safely accept are determined by the 
variables in each nursing practice setting. These 
variables include: 



( 1 ) the nurse's own qualifications in relation 
to client need and plan of nursing care, 
including: 

(A) basic educational preparation; and 

(B) knowledge and skills subsequently ac- 
quired through continuing education and 
practice; 

(2) the degree of supervision by the registered 
nurse consistent with Paragraph (d)(3) of 
this Rule; 

(3) the stability of each client's clinical condi- 
tion; 

(4) the complexity and frequency of nursing 
care needed by each client or client group; 

(5) the accessible resources; and 

(6) established policies, procedures, practices, 
and channels of communication which 
lend support to the types of nursing ser- 
vices offered. 

(b) Assessment is an ongoing process and 
consists of participation in the determination of 
nursing care needs based upon collection and in- 
terpretation of data relevant to the health status 
of a client, and according to structured written 
guidelines, policies and forms. 

(1) collection of data consists of obtaining 
data from relevant sources regarding the 
biological, psychological, social and cul- 
tural factors of the client's life and the in- 
fluence these factors have on health status, 
including: 

(A) observations of appearance and behav- 
ior; 

(B) measurements of physical structure and 
physiologic function; 

(C) information regarding available re- 
sources. 

(2) interpretation of data is limited to: 

(A) participation in the analysis of collected 
data by recogni/.ing existing relationships 
between data gathered and a client's 
health status and treatment regimen; and 

(B) determining a client's need for immedi- 
ate nursing interventions based upon data 
gathered regarding the client's health sta- 
tus, ability to care for self, and treatment 
regimen consistent with Paragraph (a)(6) 
of this Rule. 

(c) Planning nursing care activities includes 
participation in the identification of client's needs 
related to the findings of the nursing assessment. 
Components of planning include: 

(1) utilization of assessment (.lata in making 
decisions regarding implementation ot 
nursing interventions and medical orders 
and plan of care; 

(2) participation in multidiseiplinary planning 
by providing resource data; and 



5:7 NORTH CAROLINA REGISTER July 2, 1990 



4 98 



PRO POM- 1) Rl PES 



(3) identification of nursing interventions tor 
review by the registered nurse, 
(d) Implementation of nursing activities con- 
sists of delivering nursing care according to an 
established health care plan and as delegated by 
the registered nurse or other person(s) authorized 
by law as specified in G.S. 90-171.20 (S) (c). 
(1) Nursing activities and responsibilities 
which may be delegated to the licensed 
practical nurse include: 

(A) procuring resources; 

(B) actualizing nursing interventions and 
medical orders consistent with Paragraph 
(c)of 21 NCAC 36.0221; 

(C) performing nursing interventions: 

(D) recognizing responses to nursing inter- 
ventions; 

(E) modifying immediate nursing inter- 
ventions based on changes in a client's 
status; and 

( F ) delegating specific nursing tasks as out- 
lined in the plan of care and consistent 
with Paragraph (d)(2) of this Rule, and 
21 NCAC 36 .0401. 

( 2 ) the licensed practical nurse may partic- 
ipate, consistent with 21 NCAC 36 
.0224(d)(6). in implementing the health 
care plan by delegating nursing care activ- 
ities to other licensed practical nurses and 
unlicensed personnel qualified to perform 
such activities and providing all of the 
following criteria are met: 

(A) validation of qualifications of personnel 
to whom nursing activities may be deleg- 
ated: 

(B) continuous availability of a registered 
nurse for supervision consistent with 21 
NCAC 36 .0224(i) and Paragraph (d)(3) 
of this Rule; 

(C) accountability maintained by the li- 
censed practical nurse for responsibilities 
accepted, including nursing care given by 
self and by all other personnel to whom 
such care is delegated: 

(D) participation by the licensed practical 
nurse in on-going observations of clients 
and evaluation of clients responses to 
nursing actions: and 

(F) provision of supervision limited to the 
validation that tasks have been performed 
as delegated and according to established 
standards of practice. 
( 3) The degree of supervision required for the 
performance of any delegated nursing ac- 
tivity by the licensed practical nurse when 
implementing nursing care is determined 
by variables which include, but are not 
limited to: 



(A) educational preparation of the licensed 
practical nurse, including both the basic- 
educational program and the knowledge 
and skills subsequently acquired by the 
nurse through continuing education and 
practice; 

(B) stability of the client's clinical condi- 
tion, which involves both the predictabil- 
ity and rate of change. When a client's 
condition is one in which change is highly 
predictable and would be expected to oc- 
cur over a period of days or weeks rather 
than minutes or hours, the licensed prac- 
tical nurse participates in care with mini- 
mal supervision. When the client's 
condition is unpredictable or unstable, the 
licensed practical nurse participates in the 
performance of the task under close 
supervision of the registered nurse or 
other person(s) authorized by law to pro- 
vide such supervision: 

(C) complexity of the nursing task which 
is determined by depth of scientific body 
of knowledge upon which the action is 
based and by the task's potential threat to 
the client's well-being. When a task is 
complex, the licensed practical nurse par- 
ticipates in the performance of the task 
under close supervision of the registered 
nurse or other person(s) authorized by law 
to provide such supervision; 

(D) the complexity and frequency of nurs- 
ing care needed by a given client popu- 
lation: 

(E) the proximity of clients to personnel: 

( F) the qualifications and number of staff; 
(G) the accessible resources; and 
(II) established policies, procedures, prac- 
tices and channels of communication 
which lend support to the types of nursing 
services offered. 

(e) Evaluation, a component of implementing 
the health care plan, consists of participation in 
determining the extent to which desired out- 
comes of nursing care are met and in planning for 
subsequent care. Components of evaluation by 
the licensed practical nurse include: 

( 1 ) collecting evaluative data from relevant 
sources according to written guidelines, 
policies and forms: 

(2) recognizing the effectiveness of nursing 
interventions: and 

(3) proposing modifications to the plan of 
care for review by the registered nurse or 
other person(s) authorized by law to pre- 
scribe such a plan. 

(f) Reporting and recording are those commu- 
nications required in relation to the aspects ot 



499 



5:7 SORTH CAROLISA REGISTER July 2, 1990 



PROPOSED RULES 



nursing care for which the licensed practical nurse 
has been delegated responsibility. 

( 1 ) reporting means the communication of 
significant information to other persons 
responsible for or involved in the care of 
the client. The licensed practical nurse is 
accountable for: 

(A) directing the communication to the 
appropriate person(s) and consistent with 
established policies, procedures, practices 
and channels of communication which 
lend support to types of nursing services 
offered; 

(B) communicating within a time period 
which is consistent with the client's need 
for care; 

(C) evaluating the nature of responses to 
information reported; and 

(D) determining whether further commu- 
nication is indicated. 

(2) recording means the documentation of all 
significant information on the appropriate 
client record, nursing care plan or other 
documents. This documentation must: 

(A) be pertinent to the client's health care 
including client's response to care pro- 
sided; 

(B) accurately describe all aspects of nursing 
care provided by the licensed practical 
nurse; 

(C) be completed within a time period 
consistent with the client's need for care; 

(D) reflect the communication of significant 
information to other persons; and 

(E) verify the proper administration and 
disposal of controlled substances. 

(g) Collaborating involves communicating and 
working cooperatively in implementing the 
health care plan with individuals whose sendees 
may have a direct or indirect effect upon the cli- 
ent's health care. As delegated by the registered 
nurse or other person(s) authorized by law, the 
licensed practical nurse's role in collaborating in 
client care includes: 

( 1 ) participating in planning and implement- 
ing nursing or multidisciplLnary ap- 
proaches for the client's care; 

(2) seeking and utilizing appropriate resources 
in the referral process; and 

(3) safeguarding confidentiality. 

(h) Teaching and counseling involve reinforc- 
ing those activities for clients as planned and ini- 
tiated by the registered nurse or other person(s) 
authorized by law. Participation includes: 

( 1 ) providing accurate and consistent infor- 
mation, demonstrations, and guidance to 
clients, their families or significant others 
reizardinij the client's health status and 



health care according to structured written 
guidelines, policies and forms, and for the 
purpose of: 

(A) increasing knowledge; 

(B) assisting the client to reach an optimum 
level of health functioning and partic- 
ipation in self care; and 

(C) promoting the client's ability to make 
informed decisions. 

(2) collecting evaluative data consistent with 
Paragraph (e) of this Rule. 



Statutory Authority G.S. 
90-171.23(b); 90-171.43(4). 



90-171.20(7), (8); 



TITLE 25 - OFFICE OF STATE 
PERSONNEL 



No 



oticc is hereby given in accordance with G.S. 
1 SOB- 12 that the Office of State Personnel State 
Personnel Commission intends to amend rule(s) 
cited as 25 SCAC IC .02/5; ID .0504. .0509, 
.0517, .0610; IE .0802, .0803, .1101, .1104; .1/05; 
1.1 .0610. .0901 and IK .0502: repeal rule(s) cited 
as 25 SCAC II .ISO" 7 - .1314; and adopt rule(s) 
cited as 25 SCAC IB .0107 - .0120; IE 
.1111-. 1 1 12; 11 .1315; IE .0201 - .0209. 



Th 



he proposed effective date of this action is So- 
vember I. 1990. 



Th 



he public hearing will be conducted at 9:00 
a.m. on August 2. 1990 at Personnel Development 
Center. 101 W. Peace Street, Raleigh. North 
Carolina. 



Co 



omtnent Procedures: Interested persons may 
present statements orally or in writing at the 
hearing or in writing prior to the hearing by mail 
addressed to: Drake Maynard. Office of State 
Personnel. 1 16 W. Jones Street. Raleigh. North 
Carolina 2~603. 

CHAPTER I - OFFICE OF STATE PERSONNEL 

SUBCHAPTER IB -STATE PERSONNEL 
COMMISSION 

SECTION .0100 -GENERAL PROVISIONS 

.0107 PERSONNEL COMMISSION MEETINGS 

(a) The North Carolina State Personnel Com- 
mission (Commission) meets at least once each 
quarter of the calendar year. 1 he dates are set in 
advance of the coming calendar year. A copy ol 
the Commission's scheduled meetings may be 
obtained by contacting the Director, Employee 



5:7 NORTH CAROLINA REGISTER July 2, 1990 



500 



PROPOSED RULES 



Services Division, Office of State Personnel 
(OSP), 116 West Jones Street, Raleigh, N.C. 
27611. 

(b) Any person or organization wishing to be 
given advance notice of any Commission meeting 
may request such notification by writing to: Di- 
rector, Employee Services Division, OSP, 116 
W. Jones Street, Raleigh, N.C. 27611. The re- 
quest must include the name, address and tele- 
phone number of a contact person. 

(c) Meetings of the Commission are held at the 
OSP Employee and Management Development 
Center, 101 West Peace St., Raleigh, N.C, unless 
specified otherwise. 

(d) L'nless specified otherwise, a meeting of the 
Commission consists of public hearing, reading 
of minutes, business session, oral presentations 
by contested case parties and an executive ses- 
sion. 

(e) Meetings begin at 9:00 a.m. unless other- 
wise indicated. 

(f) Persons wishing to speak at the public 
hearing portion of the Commission meeting 
should sign up in advance by notifying the Em- 
ployee Services Division. OSP. either in writing 
or by telephone at (919) 733-7112. Persons may 
also sign up on the day of the meeting. Presen- 
tations to the Commission shall be limited to no 
more than 15 minutes per speaker, unless ex- 
tended by a vote of the Commission. 

(g) Meetings of the Commission, except for the 
executive session, are open to the public. The 
executive session of the Commission meeting is 
closed to the public. Only staff of the OSP may 
take part in the business session portion of the 
meeting; other persons may participate if specif- 
ically invited to do so by the Chairman. 

(h) Any person wishing to present written ma- 
terial to the Commission should prepare nine 
copies to be distributed: one copy to each Com- 
missioner, one copy to Commission counsel and 
one copy to Commission staff. 

(i) All members of the Commission will pro- 
vide statements of economic interest to the N.C 
Board of Ethics in the time and fashion required 
by that Board. 

Statutory Authority G.S. 126-4. 

.0108 COMMISSION STAFF 

(a) The OSP is the administrative staff for the 
Commission. The Employee Services Division 
provides direct staff support to the Commission. 

(b) Mail addressed to the Commission may be 
sent to the Director. Employee Services Division, 
1 16 West Jones Street. Raleigh, N.C. 27611. 



(c) The State Personnel Director is the regis- 
tered agent for service of legal process on the 
Commission. 

Statutory Authority G.S. 126-4. 

.0109 COMMISSION ACTIONS 

All decisions of the Personnel Commission, ex- 
cept those relating to employee grievances, are 
rendered in open session. Decisions of the 
Commission involving employee grievances are 
reached in executive session and communicated 
in writing from the State Personnel Director. 
Information relating to such decisions will not 
be released publicly until the OSP has received 
notice that each party has received a copy of the 
Commission's decision. 

Statutory Authority G.S. 126-4. 

.0110 MOTIONS 

Motions may be made by any member of the 
Commission, including the Chairman. For fur- 
ther action to be taken, the motion made must 
be seconded by at least one other Commissioner 
other than the member who made the motion. 
A motion which is not seconded after two calls 
for seconds by the Chairman shall die and not 
be acted upon. A motion which was properly 
seconded shall be discussed to the extent the 
Commission desires before any vote is taken. A 
vote may be taken only after all discussion has 
been concluded. The Chairman may close dis- 
cussion, at his discretion, and call for a vote. 
Minutes of the Commission will reflect the name 
of the Commissioner making the motion and the 
name(s) of the Commissioner(s) seconding the 
motion. 

Statutory Authority G.S. 126-4. 

.0111 VOTING 

At the appropriate time, in accordance with 
Rule .0110 of this Section, a properly seconded 
motion shall be voted on by the members of the 
Commission present. All members present, in- 
cluding the Chairman, must either vote or ab- 
stain. .-Ml votes shall be voice votes, unless 
otherwise decided by the Commission, with AVE 
signifying agreement with the motion and NAY 
signifying disagreement with the motion. Any 
member, including the Chairman, may ask that 
a vote be taken by raising hands, so that a defi- 
nite count of the vote may be taken. Motions 
which receive a majority favorable vote are 
adopted. Motions which receive a tie vote or a 
majority negative vote are not adopted. Minutes 
of the Commission will reflect the vote taken on 



501 



5:7 NORTH CAROLINA REGISTER July 2, 1990 



PROPOSED RULES 



each motion and the outcome of the vote. The 
minutes will also reflect the names of each com- 
missioner with his vote if voting is done by hand. 
Any Commissioner abstaining from a vote will 
be so indicated in the minutes. 

Statutory Authority G.S. 126-4. 

.0112 ABSTENTION 

A commissioner who has any conflict of inter- 
est, either actual or potential as defined in Inter- 
pretive Memorandum #1, April 5, 1985 of the 
N. C. Board of lithics, shall voluntarily abstain 
from taking any part in any action before the 
Commission. This abstention shall include, but 
is not limited to, refraining from discussion in the 
public or business session, making of or second- 
ing of motions and voting. A commissioner who 
is abstaining from an action the Commission is 
considering should announce such abstention at 
the earliest possible time in the public or business 
session and prior to any discussion or vote on the 
action. 

Statutory Authority G.S. 126-4. 

.0113 Dill ES OF TH E CI I AIRMAN 

The Chairman shall be authorized to perform 
at least the following duties and responsibilities 
at each meeting of the Commission: 

( 1) The Chairman shall call the meeting to or- 
der. 

(2) The Chairman may make opening remarks 
as he deems necessary. 

(3) The Chairman shall introduce each portion 
of the meeting and make whatever remarks 
he deems necessary as part of the introduc- 
tion. 

(4) The Chairman may extend or limit, on his 
own or upon the vote of the Commission, 
the time allotted for a speaker making a 
presentation to the Commission. 

(5) The Chairman shall call for motions, sec- 
onds, discussion and votes as appropriate. 

(6) I he Chairman may call for a recess or meal 
period as appropriate. 

(7) The Chairman shall adjourn the open por- 
tion of the meeting and begin the executive 
portion of the meeting. 

(8) The Chairman shall call for the 
adjournment of each meeting. 

(9) The Chairman may direct the removal of 
individuals from Commission meetings for 
disruptive conduct or failure to comply with 
Commission rules. 

The Chairman shall have the authority to exer- 
cise such other responsibilities not enumerated in 



this Rule which are necessary to the performance 
of the business of the Commission. 

Statutory Authority G.S. 126-4. 

.01 14 ORDER OF BUSINESS 

Unless changed by a vote of the Commission, 
the order of business at each meeting of the N.C. 
State Personnel Commission will be as follows: 

(1) Call to order by the Chairman. 

(2) Call for reading/approval of minutes of the 
last meeting. 

(3) Public hearing session. 

(4) Business session. 

(5) Oral presentations by contested case hear- 
ing parties. 

(6) Executive session. 

(7) Adjournment of meeting. 

Additional portions may be added by vote of the 
Commission. 

Statutory Authority G.S. 126-4. 

.0115 SPECIAL MEETINGS 

Other than the regularly scheduled meetings (see 
Rule .0107 of this Section), a meeting may be 
called at any time by a majority of the Commis- 
sion. Such a meeting must be announced in ac- 
cordance with G.S. 143-318.10 and conducted in 
accordance with this Section. Special meetings 
may be full meetings with a regular order of 
business as set out in this Rule or they may be 
limited to one or more special matters. 

Statutory Authority G.S. 126-4; 143-318.10. 

.0116 Dl TIES OK CHAIRMAN BETWEEN 
MEETINGS OF THE COMMISSION 

The Chairman of the Commission shall have 
such duties and responsibilities between each 
meeting of the Commission as the Chairman 
and/or the Commission determine to be neces- 
sary, including but not limited to: 

(1) Receipt and response to correspondence 
addressed to the Commission; 

(2) Review of proposed agenda of meetings; 

(3) Administration of matters regarding at- 
tendance and credentials of members of the 
Commission. 

Statutory Authority G.S. 126-4. 

.0117 STANDING/SPECIAL COMMITTEES 

The Chairman of the Commission shall appoint 
such standing or special committees as the 
Chairman or the Commission shall deem neces- 
sary. The Chairman shall designate the Chair- 
man of each committee from unions; its members 



5:7 NORTH CAROLINA REGISTER July 2, 1990 



502 



PROPOSED RULES 



and shall be an ex officio member of all com- 
mittees. A majority of the duly appointed 
members of a committee shall constitute a quo- 
rum. 

Statutory Authority G.S. 126-4. 

.0118 MINUTES 

Minutes and other records of all Commission 
meetings shall be kept under the direction of the 
Director of the Employee Services Division of 
the Office of State Personnel, such record to be 
supplemented, as necessary, by electronic re- 
cording. Minutes shall be maintained in the 
limployee Services Division of the Office of State 
Personnel permanently. 

Statutory Authority G.S. 126-4. 

.01 19 NOTICE OF COMMISSION ACTION 

In accordance with N.C.G.S. Chapter 150B, the 
State Personnel Director or an appropriate 
designee shall be responsible for the timely issu- 
ance of any applicable notices to those parties 
who, pursuant to the statute in this Rule, must 
be given legal notice of Commission meetings, 
hearings, decisions and official actions. 

Statutory Authority G.S. I 26-4; /JOB. 

.0120 APPOINTMENT OF VICE-CHAIRMAN 

The Chairman shall appoint a vice-chairman. 
who shall serve at the pleasure of the Chairman, 
to preside over meetings of the Commission if 
the Chairman is unable to attend a meeting. The 
authority of the Vice-Chairman shall be limited 
to presiding over the meeting in the absence of 
the Chairman. The Vice-Chairman shall exercise 
only those powers necessary to carry out the re- 
sponsibilities of the Chairman at the meeting in 
the absence of the Chairman. 

Statutory Authority G.S. 126-4. 

SUBCHAPTER 1C - PERSONNEL 
ADMINISTRATION 

SECTION .0200 - GENERAL EMPLOYMENT 

POLICIES 

.0215 EMPLOYMENT CONTRACTS 

(a) No person shall be required, as a condition 
of employment subject to N.C.G.S. Chapter 126 
to enter into a contractual arrangement with any 
state agency or university for employment with 
that agency or university. However, this shall 
not prohibit apprenticeship agreements lor train- 
ing purposes when executed according to the 
pro\ [signs of NCOS Chapter 94, 



(b) No state agency or university may require, 
as a condition of employment, that a person 
agree, in writing or otherwise, to a minimum 
specified length of employment, except for the 
minimum training period specified in an appren- 
ticeship agreement duly executed under G.S. 
Chapter ')4. 

Statutory Authority G.S. 94; 126-4. 

SUBCHAPTER II) - COMPENSATION 

SECTION .0500 - SEPARATION 

.0504 REDUCTION IN FORCE 

(e) Leave »«4 Salary ' Incruar i oa 
f44 1 cave - Without Pay. 44* enable additional 
benefit .. , employees sebethrfed fof 
reduction in force ' '. hall, upon their Fe- 
quo '. t, be placed h+ leave - without pay 



Statutory Authority G.S. 126-4(2). 

.0509 SEVERANCE SALARY CONTINUATION 

(1) Eligible Employees: 

(a) A permanent full-time or part-time (20 
hours or over) employee who does not 
obtain another permanent job in state 
government by the effective date of the 
reduction-in-force shall be eligible for 
severance salary continuation whether 
when separated, p* placed m leave with 
etrt pay r . tatn -. . This shall not apply to 
employees whose reduction-in-force is not 
considered permanent; that is, employees 
who are reducted-in-force on a temporary 
or seasonal basis with the expectation that 
they will return to work within twelve 
months. 

Statutory Authority G.S. 126-4(10); 143-27.2. 

.0517 LEAVE 

(b) Sick Leave. Accumulated sick leave at the 
time of separation shall be reinstated if reem- 
ployment occurs within three years. 

ft-4 1 e av e Without Pay Option. 4-*+ enabl e ad- 
ditional bene lit 1 /, employ aes '. cheduled t& be seg 
arated shall, upon their request, be placed m a 
leave W ithout pay '. latin . . 

fdi Salary Increase '. . 14 reemploy ed during the 
tv i eb e month period, time earned toward a '. alary 
increase i . hall be con '. i de - red h* determ i ning eligi 
bility t*+f the He*t increas e . 

Statutory Authority G.S. 126-4(6), (10). 

SECTION .0600 - REALLOCATION 



503 



5:7 WORTH CAROLINA REGISTER July 2, 1990 



PROPOSED RULES 



.0610 REALLOCATION TO A LOWER GRADE 

(a) When an employee's position is assigned to 
a lower grade, toe employee's salary may- r e main 
toe same tf rt- is within toe lower range * ; »f k- may 
be reduc e d to any- salary to toe low e r rang e to 
equitably relat e to oth e r emp l oyees' salari e s m 
toe same &f related elassifieatteftS: 



(&) tf toe employee's sakffy is above toe maxi 
mum to toe grade to which toe position » as- 
sign e d, one of the following options will apply: 
( 1 ) When reduction in level of the position 
results from management decisions on 
program changes, reorganization, or other 
management needs not associated with 
the employee's demonstrated motivation, 
capability, acceptance of responsibility or 
lack of performance, toe ■ .' . alary to toe em- 
ployee may remain above toe Hew- maxi 
mum a* long a* toe employee remain * ' , to 
toe same clarification ef is promot e d to 
a higher lev e l position. r»to further in- 
cr e ases, oth e r than l e gislativ e increase '. , 
may be granted as long as toe salary fe- 
m.nns above toe maximum, to however, 
a position is availabl e , toe level to which 
would Hto be as d e trim e ntal to toe ai- 
f e cted employe e . a«4 if toe employ e e is 
qualified bto ftto placed mto toe position, 
then toe option m Paragraph (-3-^ to tots 
Rule '. hall apply, the position must be 
reallocated to the approved classification 
and grade in accordance with the pro- 
visions of 25 NCAC ID . 0600(b). RF- 



Al 1 OCA I ION 1() A 
GRADI •:. 



IIGIIFR 



(b) fto It is a management responsibility to 
avoid creation of salary inequities among em- 
ployees. Each case must be evaluated to deter- 
mine which of the salary administration 
alternatives is most appropriate, based on the 
circumstances as documented by the employing 
agency. 

Statutory .tut/unity G.S. 126-4(2). 

SUBCHAPTER IE - EMPLOYEE BENEFITS 

SECTION .0800 - MILITARY LEAVE 

.0X02 MILITARY LEANT. WITH PAY 

leave with pay shall be granted to members of 
Reserve Components of the U.S. Armed Forces 
for certain periods of active duty training and to 
members of the State Militia (National Guard, 
including the State Defense Militia) for State 
military duty. 

Statutory Authority G. S. 126-4; 127A-U6. 



.0803 DEFINITIONS 

Reserve Components of the U.S. Armed Forces 
are the National Guard, the Army Reserve, the 
Naval Reserve, the Marine Corps Reserve, the 
Air Force Reserve and the Coast Guard Reserve. 
The Civil Air Patrol is not a Reserve Compo- 
nent; it is an Air Force Auxiliary and its members 
are not subject to obligatory service. The Na- 
tional Guard is unique among the Reserve 
Components in that it has a dual role, serving 
both as a Federal Reserve Component and as the 
State Militia. In its role as State Militia the 
North Carolina Army National Guard and the 
North Carolina Air National Guard respond to 
the Governor who is their Commander-in-Chief 
and serves as the military arm of the State gov- 
ernment. The State Defense Militia, which is a 
component oi Ltl£ National Guard, is also a part 
of the State Militia. Therefore, the National 
Guard is subject to active State duty upon order 
of the Governor. 

Statutory Authority G. S. I27A-1 16. 

SECTION .1100 - OTHER LEAVES WITHOUT 
PAY 

.1101 POLICY 

Leave without pay ma)' be granted to a full-time 
or part-time permanent, trainee or probationary 
employee for parental leave educational pur- 
poses, vacation, or for any other reasons deemed 
justified by the agency head and the State Per- 
sonnel Director. 

Statutory Authority G.S. 126-4. 

.1 104 AGENCY RESPONSIBILITY 

The decision to grant leave without pay is an 
administrative one for which the agency head 
must assume full responsibility. Factors to con- 
sider arc needs of the employee requesting leave, 
operational needs, workload, need for tiling em- 
ployee's job, chances of employee returning to 
duty, and the obligation of the agency to reinstate 
employee to a position of like status and pay. 
It is the responsibility of the agency to administer 
leave without pay in a manner that is equitable 
to all of its employees. Reinstatement to the 
same position or one of like seniority, status and 
pay must be made upon the employee's return 
to work unless other arrangements are agreed to 
in writing. »f unless toe employee is tm leav e 
without pay as a result ef a reduction in force. 
If it is necessary to fill a position which is vacant 
by leave without pay, the position may be filled 
by a temporary or time-limited permanent ap- 
pointment, whichever is appropriate. 



5:7 NORTH CAROLINA REGISTER July 2, 1990 



504 



PROPOSED RULES 



Statutory Authority G.S. 126-4. 

.1105 RETENTION OF BENEFITS 

(b) Accumulated vacation leave may be ex- 
hausted before going on leave without pay, or the 
employee may choose to retain part or all of ac- 
cumulated leave until return to state service. 
Exceptions: 

(2) if an employee requests leave for personal 
reasons for a period not to exceed 10 work 
days, vacation leave must be used if 
available; however, if the leave is for a 
period longer than 10 work days, the em- 
ployee may choose to use vacation leave 
or retain it for future use. If leave without 
pay extends through December 31, any 
vacation leave accumulation above 240 
hours shall be cancelled. 
When exhausting leave the employee continues 
to earn leave, is eligible to take sick leave, is en- 
titled to holidays, and is eligible for salary in- 
creases during that penod. General provision;- , 
sf* included und e r the heading "Vacation 
I eave". If the employee does not return to work 
following leave without pay. the employee shall 
be paid for any accumulated vacation leave at 
time of separation. (Reference: 25 NCAC IE 
.0200, Vacation Leave). 

Statutory Authority G.S. 126-4. 

.1111 EXTENDED LEAVE WITHOUT PAY 

Lxtended leave without pay must be adminis- 
tered in accordance with the provisions outlined 
in this Rule. Extended leave without pay is de- 
fined as leave in excess of one-half the workdays 
in the month or in the pay period (whichever is 
applicable), in which case a personnel action 
must be submitted to place the employee in leave 
without pay status. 

Statutory Authority G. S. 126-4. 

.1112 SHORT LEAVE WITHOUT PAY 

(a) Short leave without pay is defined as leave 
for less than one-half the workdays in the month 
or in the pay period (whichever is applicable). 
This is used to account for time that an employee 
is absent and has no accumulated or advanced 
lease credits. The employee must have approval 
from the supervisor. These short periods may 
be docked from the employee's pay check with- 
out submitting a personnel action form. The 
employee earns all benefits for which eligible. 

(b) Short leave without pay may also be used 
to account for time that an employee is absent 
without approved leave, i.e., to cover the status 



of an employee who has failed to come to work 
but has not requested and received approval to 
take sick or vacation leave. Agency management 
is responsible for determining whether leave 
without pay is appropriate or whether the time 
may be charged to the appropriate leave account. 



Statutory Authority G. S. 126-4. 

SUBCHAPTER II -SERVICE 
GOVERNMENT 



IO LOCAL 



SECTION .1300 - DISCIPLINARY ACTION: 
SUSPENSION AND DISMISSAL 



.1307 
.1308 
.1309 



.1310 
.1311 

.1312 
.1313 
.1314 



APPEALS (REPEALED) 

CAUSES (REPEALED) 

DISMISSAL: CAUSES RELATING 

TO PERFORMANCE OF DUTIES 

(REPEALED) 

DISMISSAL (REPEALED) 

DISMISSAL: CAUSES RELATED 

TO PERSONAL CONDUCT (REPEALED) 

SUSPENSION (REPEALED) 

DEMOTION (REPEALED) 

SPECIAL PROVISIONS: CREDENTIALS 

(REPEALED) 



Statutory Authority G. S. 126-4; 126-35; 126-37; 
1 26-38;' Chapter 1 50B, Article 3. 

.1315 LOCAL AGENCIES SUBJECT TO 

SAME RULES AS STALE AGENCIES 

local government agencies subject to Chapter 
126 arc required to conform their disciplinary 
practices to the rules governing disciplinary' 
action, suspension and dismissal of state em- 
ployees. See 25 NCAC U SECTION .0600 - 
DISCIPI INARY ACTION: SUSPENSION" 
AND DISMISSAL, Rules U .0603 - .0612. Eor 
the purpose of utilizing those rules, the word 
"permanent" shall mean a person who has com- 
pleted a probationary penod of not less than 
three months nor more than nine months. See 
25 NCAC II SECTION .0700 - APPOINT- 
MENT AND SEPARATION. Rule .0702. 

Statutory Authority G. S. 126-4; 126-35; 126-37. 

SUBCHAPTER 1.1 - EMPLOYEE RELATIONS 

SECTION .0600 - DISCIPLINARY ACTION: SUS- 
PENSION AND DISMISSAL 

.0610 SUSPENSION 

Investigatory or disciplinary suspension may be 
used by management in appropriate circum- 
stances. However, the following provisions shall 
control its use: 

(2) Investigatory suspension without pay may 
be used to provide time to investigate, es- 



505 



J).- 7 



\ORTH CAROLINA REGISTER July 2,1990 



PROPOSED RULES 



tablish facts, and reach a decision concerning 
an employee's status in those cases where it 
is determined the employee should not con- 
tinue to work pending a decision. 
Investigatory suspension without pay may 
be appropriately used to provide time to 
schedule and hold a pre-dismissal confer- 
ence. Also, management may elect to use 
investigatory suspension in order to avoid 
undue disruption of work or to protect the 
safety of persons or property. An 

investigator)' suspension without pay shall 
not exceed 45 calendar days. However, a 
department or university may, in the exercise 
of its discretion, extend the period of 
investigatory suspension without pay be- 
yond the 45-day limit. The employee must 
be informed in writing of the extension, the 
length of the extension, the specific- reasons 
for the extension and his right of appeal. A 
copy c4" the abovt ' communication ahull be. 
se»t- to toe Stuto Personal Director. If no 
action has been taken by management by 
the end of 45 calendar days, and no exten- 
sion has been made, one of the following 
must occur: Reinstatement of the employee 
with full backpay; appropriate disciplinary' 
action based on the results of the investi- 
gation; reinstatement of the employee with 
up to three days pay deducted from the 
backpay. 

Statutory Authority G. S. 126-4. 

SECTION .0900 - INTERNAL PERFORMANCE 
PAY DISPUTE RESOLUTION PROCEDURES 

.0901 A PROCEDURE SPECIFICALLY 

DESIGNED ONLY PERFORMANCE 
PAY DISPUTES 

The following are requirements and guidelines 
for an approved internal performance pay review 
process which is specifically designed to handle 
only performance pay disputes: 
(2) The Review Mechanism: 
(a) The first step in reviewing a performance 
management decision complaint shall be 
for the employee to review his complaint 
with his immediate supervisor or the ap- 
propriate management person. If the 
employee is not satisfied with the first step 
response, the next level of review will be 
by either the agency grievance committee 
or a separately constituted dispute resol- 
ution review hoard. 
f»} (bj The review will be conducted by a 
board consisting of at least three persons 
who will take information from the em- 
ployee and from management's represen- 



tative and will make a written 
recommendation, consistent with the in- 
formation received, to the agency head. 
The agency head shall have the authority 
to accept or modify the board's recom- 
mendation or to adopt a different deci- 
sion. 

(b4 [c] Neither side will be permitted to be re- 
presented by an attorney. The proceeding 
shall not be tape recorded except as an 
administrative convenience to the review 
board. No person shall be required to 
testify under oath. 

(&) (d^ The employee must be allowed to ap- 
pear in person before the review board 
before a final agency decision is rendered. 

(4) (e) The review should be held within rea- 
sonable geographic proximity to the em- 
ployee's worksite. Witnesses, other than 
the employee and management's repre- 
sentative, should be strictly limited. All 
members of the board should be allowed 
to ask questions of the employee and 
management's representative. A majority 
vote, rather than a unanimous vote, of the 
board should decide the recommendation 
to the agency head. Any travel required 
of the employee in order to get to the lo- 
cation of the review board hearing shall 
be done on state time; any mileage in- 
curred as a result of this travel shall be 
reimbursed under existing budget guide- 
lines. 

Statutory Authority G. S. 126-4. 

SUBCHAPTER IK - PERSONNEL TRAINING 

SECTION .0500 - APPRENTICESHIP TRAINING 

.0502 APPOINTMENT PROVISIONS 

AH- applicant -. ««4 employee ', ent e ring appren 
ticc.ihip program;- , '. hall be subj e ct to toe tfataee 
appointment provisions t+f toe Stat e Personnel 
Commission. (See 35 NCAC U± S e ction 44000, 
Rule" . 4400X - .020U.) All persons entering an 
apprenticeship program supported by tunding 
from positions subject to the State Personnel Act 
shall receive a regular trainee appointment, and 
shall receive the same employment benetits as 
other SPA employees with trainee appointments. 
I pon successful completion of an apprenticeship 
program, an apprentice who enters regular state 
employment shall receive a permanent appoint- 
ment. 

Statutory Authority G.S. 126-4. 

SUBCHAPTER 1L - AFFIRMATIVE ACTION 



5:7 NORTH CAROLINA REGISTER July 2, 1990 



506 



PROPOSED RILES 



SECTION .0200 -ACQl IRED IMMUNE 

DEFICIENCY SYNDROME (AIDS) IN THE 

WORKPLACE 

.020! PI RPOSE 

North Carolina state government acknowledges 
its obligation as an employer to provide a safe 
and healthful work environment for all of its 
employees. Furthermore, the State recognizes 
the employment-related rights and concerns of 
employees who may be exposed as a part of their 
job duties to HIV infection or who may have 
HIV infection. In light of the concerns and the 
increasing incidence of AIDS, an infectious dis- 
ease not transmitted by casual contact, state 
government has developed this policy to provide 
implementation guidance for all managers and 
employees on how to deal with AIDS in the 
workplace. Further, this policy has been devel- 
oped to address morale, productivity, safety, 
anti-discrimination, confi- dentiality and other 
areas that are impacted by this policy. 

Statutory Authority G.S. 126-4. 

.0202 POLICY 

It is the policy of state government to provide 
a work environment to protect the health and 
well being of all of its employees. To this end, 
the state will provide education and training, 
work practices, procedures, and ensure that em- 
ployees who are exposed to or have HIV in- 
fection are provided with confidential, fair and 
equal treatment. Additionally, this policy out- 
lines the rights and responsibilities of supervisors 
and employees regarding HIV infection in a work 
environment. 

Statutory Authority G.S. 1 26-4. 

.0203 EDUCATION AND TRAINING 

All agencies and institutions of State govern- 
ment will undertake an education and training 
program. This program will have two compo- 
nents: a basic education and training component 
for all employees and an advanced education and 
training component for employees who perform 
tasks that have a greater potential for exposure 
to the II IV virus. 

Statutory Authority G.S. 126-4. 

.0204 BASIC EDUCATION AND TR VINING 
COMPONENT 

(a) To insure consistency the Office of State 
Personnel, with guidance from the State Public 
Health Director, will identify or develop basic 



education and training programs which agencies 
are required to provide for all their employees. 

(b) Through the WISH program coordinators 
in each agency or other appropriate resources 
designated by the agency head, and with the as- 
sistance of professional health educators, all em- 
ployees will be offered training within two years 
from the adoption of this policy, and thereafter 
for new employees within six months of initial 
employment. A Certificate of Completion will 
become a part of the employee's personnel re- 
cord. 

Statutory Authority G.S. 126-4. 

.0205 ADVANCED EDUCATION AND 
TRAINING COMPONENT 

(a) The Office of State Personnel will identify 
training modules and resources as approved by 
the State Public Health Director which will ad- 
dress the special education and training needs of 
employees who perform work related tasks that 
have a potential for exposure to the II IV virus. 
Each agency shall adopt these resources to their 
own work force needs. 

(b) Fach agency with employees requiring ad- 
vanced training will provide such training within 
six months from the adoption of this policy. 
Agencies must provide training for new employ- 
ees during their work orientation period. The 
Agency shall appropriately document the em- 
ployees' compliance with this policy. 

(c) All employees shall periodically be provided 
updated general public health information issued 
by the State Public Health Director or the U.S. 
Centers for Disease Control. Such educational 
literature shall be distributed as appropriate after 
further approval by the State Personnel Director 
in consultation with the State WISE Advisory 
Board. Appropriate records are to be maintained 
by the agency as proof of completion of any pe- 
riodic update of employee education. 

Statutory Authority G.S. 126-4. 

.0206 ANTI-DISCRIMIN VTION 

It is the State's policy not to discriminate 
against any applicant or employee who has or is 
suspected of having .AIDS or HIV infection. The 
State recognizes that an employee with AIDS or 
II IV infection may wish to continue working. 
As long as an employee is able to satisfactorily 
perform the duties of the job [G. S. 168A-3(9), 
130A- I4S(i)] and there is no medical evidence 
indicating that the employee's condition is a 
health threat to the employee, co-workers or the 
public, an employee shall not be denied contin- 
ued employment nor shall any applicant be de- 



5<r 



:>.-/ 



NORTH CAROLINA REGISTER July 2,1990 



PROPOSED RULES 



nied employment solely because of a medical 
condition. 

Statutory Authority G.S. 126-4; I30A-148C(i); 

168.4-3(9). 

.0207 TESTING AND EXAMINATION 

Medical tests and examinations to determine the 
presence of HIV or HIV associated conditions 
are prohibited except as authorized by state and 
federal law or required by the rules of the Com- 
mission for Health Services. An employee who 
suspects that, having had a nonsexual blood or 
body fluid exposure to the HIV virus while on 
the job, may voluntarily elect to be tested for the 
HIV infection, provided that the suspected ex- 
posure poses a significant risk of transmission of 
HIV as defined in the rules of the Commission 
for Health Services. The cost of tests for the ex- 
posed employee shall be borne by the employer, 
if requested by the employee. Some employees 
may prefer to pay for their own test through a 
personal or family physician, or use the free test- 
ing sen ices of a Public Health Department. 

Statutory Authority G.S. 126-4. 

.020S CONFIDENTIALITY , 

Confidentiality shall be strictly maintained b\ 

the agency for any employee with II1Y or 'HIV 

associated conditions as required by existing 



confidentiality rules and laws. Any current 
confidentiality policies that are in force shall be 
updated by the agency to include the HIV policy. 

Statutory Authority G.S. 126-4. 

.0209 COMPLAINTS AND DISCIPLINE 

The State acknowledges that employees with 
1 1 IV infection as well as their co-workers may 
have concerns for their own health and safety. 
Managers are to pursue all appropriate actions to 
respond to the concerns of all employees. The 
state recognizes the rights of employees to griev- 
ance procedures. The employer has an equal 
right to maintain a harmonious and productive 
work environment that is free from disruptive or 
inconsiderate behavior, or from the refusal of any 
employee to perform work at assigned times and 
locations. If insubordinate or disruptive actions 
occur, managers are to follow the normal disci- 
plinarv procedures described in 25 NCAC 1.1 
.0600, DISCIPLINARY ACTION, SUSPEN- 
SION AND DISMISSAI . Before any discipli- 
nary action can be taken, an agcnc\ or institution 
shall first provide counseling by a qualified health 
care professional to an employee who fears that 
a serious health risk is created by the presence of 
a co-worker who has AIDS or II IV infection 

Statutoiy Authority G.S. !2f>-4. 



5:7 iXORTII CAROLINA REGISTER July 2, 1990 



50S 



ARRC OBJECTIONS 



1 he Administrative Rules Review Commission (ARRC) objected to the following rules in accord- 
ance with G.S. I43B-30.2(c). State agencies are required to respond to ARRC as provided in G.S. 
USB- 30.2(d). 



ECONOMIC AND COMMUNITY DEVELOPMENT 

Savings Institutions Division 

4 XCAC 16 A .0302 - Response of Administrator to Petition 
4 XCAC 16A .0402 - Informal Settlement 

ENVIRONMENT, HEALTH, AND NATURAL RESOURCES 

Environmental Health 

I5A XCAC ISA .1814 - Disposal of Garbage and Trash: Premises 
ISA XCAC JSC .1528 - Point- of- Entry and Other Treatment Devices 

Environmental Management 

ISA XCAC 2E .0102 - General Criteria 

ISA XCAC 2E .0105 - Effective Contingent Upon Eederal Eunds Allocated 

Health: Epidemiology 

15 A XCAC I9B .0202 - Granting Permits 

ISA XCAC I9D .0407 - Medical Eligibility 

ISA XCAC I9D .0408 - Medical Eligibility Licensed Nursing HomeSenices 

Laboratory Services 

ISA XCAC 20 A .0002- Definitions 

Wildlife Resources Commission 

ISA XCAC IOC .0501 - Scope and Purpose 

HUMAN RESOURCES 

Medical Assistance 

10 XCAC SOB .0311 - Reserve 

Youth Services 

10 XCAC 44E .1305 - Corporal Punishment and Child Abuse 

LICENSING HOARDS AND COMMISSIONS 

Certification Board for Social Work 

21 XCAC 63 .0/04 - Organization of the Board 
21 XCAC 63 .0301 - Written Examinations 
21 XCAC 63 .0403 - Renewal Eees 



ARRC Objection 5 
ARRC Objection 5 



17 90 
17 90 



ARRC Objection 6 
ARRC Objection 6, 



ARRC Objection 5 
ARRC Objection 5 



ARRC Objection 6 

ARRC Objection 6 
ARRC Objection 6 



21 90 
2P90 



17 90 
17/90 



21. 90 
21/90 

21 90 



ARRC Objection 6 21 90 



ARRC Objection 6 21/90 



ARRC Objection 6 21 90 



ARRC Objection S 17,90 



ARRC Objection 5 1" 90 
ARRC Objection 5 17 90 
ARRC Objection 5 r 90 



509 



5:7 NORTH CAROLINA REGISTER July 2, 1990 



ARRC OBJECTIONS 



PUBLIC EDUCATION 

Elementary and Secondary Education 
16 XCAC 6D .0/05 - Use of School Day 
SECRETARY OF STATE 



Corporations Division 



IS XCAC 4 
IS XCAC 4 
IS XCAC 4 
18 NCAC4 
IS XCAC 4 
IS XCAC 4 
IS XCAC 4 
IS XCAC 4 
IS XCAC 4 
IS XCAC 4 
IS XCAC 4 
IS XCAC 4 
IS XCAC 4 
XCAC 4 
XCAC 4 
XCAC 4 
IS XCAC 4 
IS XCAC 4 
IS XCAC 4 
IS XCAC 4 
IS XCAC 4 



IS 
IS 
IS 



.0101 
.0102 
.0205 
.0206 
.0302 
.0303 
.0305 
.0306 
.0307 
.0308 
.03/1 
.0312 
.0313 
.0314 
.0316 
.0401 
.0402 
.0501 
.0502 
.0503 
.0504 



ARRC Objection 6I21/90 



Location and Hours 

A dministration and Functions 

Overpayment 

Documents Xot Specifically Provided For 

Execution 

Rejection 

Corrective Filings- Xonprofit Corp; Limited Partnerships 

Articles of Incorporation - Xonprofit Corporations 

Application For Reservation of Corporate Xame 

Registered Office and Registered Agent 

Art of Merger! Share Exch ;G.S. 55-/1-07,55.4-42.1 

Appl For Cert of Authority 'Foreign Prof Corporation 

Filing Merger Involving Foreign Corporation 

Filing Evidence of Dissolution; Foreign Xonprofit Corp 

Form for Annual Report 

Documents 

Cert of Facts Certificate of Exit; A uthorization 

General 

Words Prohibited in Addition to Slatutoiy Prohibitions 

Deceptively Similar and Distinguishable Names 

Filing Fictitious' Assumed Xame : Foreign Corporation 



ARRC 
ARRC 
ARRC 
ARRC 
ARRC 
ARRC 
ARRC 
ARRC 
ARRC 
ARRC 
ARRC 
ARRC 
ARRC 
ARRC 
ARRC 
ARRC 
ARRC 
ARRC 
ARRC 
ARRC 
ARRC 



Objection 
Objection 
Objection 
Objection 
Objection 
Objection 
Objection 
Objection 
Objection 
Objection 
Objection 
Objection 
Objection 
Objection 
Objection 
Objection 
Objection 
Objection 
Objection 
Objection 
Objection 



6/21/90 
6/21J90 
6/21/90 
6121:90 
6/21/90 
6/21:90 
6121190 
6121/90 
6/21;90 
6/21:90 
6/21:90 
6/21/90 
6/21, 90 
6/21/90 
6121/90 
6/21/90 
6/21 90 
6 21 90 
6/21/90 
6/21/90 
6' 2 1 90 



Securities Division 



AS XCAC 6 .1210 - Securities Exchgs/Auto Quotation Sys Approve: Admin ARRC Objection 6 21 90 



5:7 NORTH CAROLINA REGISTER July 2, 1990 



510 



NORTH CAROLINA ADMINISTRA Til E CODE CLASSIFICA TION SYSTEM 



The North Carolina Administrative Code (NCAC) has four major subdivisions of rules. Two 
of these, titles and chapters, are mandatory. The major subdivision of the XCAC is the title. 
Each major department in the North Carolina executive branch of government has been as- 
signed a title number. Titles are further broken down into chapters which shall be numerical 
in order. The other two, subchapters and sections are optional subdivisions to be used by 
agencies when appropriate. 

TITLE/MAJOR DIVISIONS OF THE NORTH CAROLINA ADMINISTRATIVE CODE 



riTLE 


DEPARTMENT 


LICENSING BOARDS 


CHAPTER 


1 


Administration 


Architecture 


2 


2 


Agriculture 


Auctioneers 


4 


3 


Auditor 


Barber Fxaminers 


6 


4 


Economic and Community 


Certified Public Accountant Examiners 


8 




Development 


Chiropractic Examiners 


10 


5 


Correction 


General Contractors 


12 


6 


Council of State 


Cosmetic Art Examiners 


14 


7 


Cultural Resources 


Dental Fxaminers 


16 


8 


Elections 


Electrical Contractors 


18 


9 


Governor 


Foresters 


20 


LO 


Human Resources 


Geologists 


21 


11 


Insurance 


Hearing .Aid Dealers and Fitters 


22 


12 


Justice 


I andscape Architects 


26 


13 


labor 


Landscape Contractors 


28 


14A 


Crime Control and Public Safety 


Marital & Family Therapy 


M 


15A 


Environment, Health, and Natural 


Medical Fxaminers 


52 




Resources 


Midwifery 7 Joint Committee 


33 


16 


Public Education 


Mortuary Science 


34 


17 


Revenue 


Nursing 


36 


18 


Secretary of State 


Nursing Home Administrators 


37 


19A 


Transportation 


Occupational Therapists 


38 


20 


Treasurer 


Opticians 


40 


♦21 


Occupational licensing Boards 


Optometry 


42 


22 


Administrative Procedures 


Osteopathic Fxamination and 


44 


23 


Community Colleges 


Registration 




24 


Independent Agencies 


Pharmacy 


46 


25 


State Personnel 


Physical Therapy Fxaminers 


48 


26 


Administrative Hearings 


Plumbing and I leating Contractors 


50 






Podiatry Examiners 


52 






Practicing Counselors 


53 






Practicing Psychologists 


54 






Professional Engineers and I and Surveyors 56 






Real Estate Commission 


58 






Refrigeration Fxaminers 


60 






Sanitarian Fxaminers 


62 






Social Work 


63 






Speech and I anguage Pathologists and 


'■4 






Audiologists 








Veterinary Medical Board 


66 



Note: Title 21 contains the chapters 



th 



e various 



occupational licensing boards. 



511 



5:7 NORTH CAROLINA REGISTER July 2, 1990 



CUMULATIVE INDEX 



CUMULATIVE INDEX 

(April 1990 - March 1991 ) 



1990 - 1991 



Pases 



Issue 



1 - 151 1 - April 

152- 235 2 - April 

236- 285 3 - May 

286- 312 4 - May 

313- 407 5 - June 

408- 473 6 - June 

474- 513 7 - July 



AO - Administrative Order 

AG - Attorney General's Opinions 

C - Correction 

l'R - Final Rule 

GS - General Statute 

JO - Judicial Orders or Decision 

\I - Miscellaneous 

NT - Notice of Petitions 

PR - Proposed Rule 

SO - Statements of Organization 

I R - Temporary Rule 



ADMINISTRATION 

State Property and Construction, 41 1 PR 

AGRICULTURE 

Plant Conservation Board, 1 PR 
Structural Pest Control Committee, 7 l'R 

CRIME CONTROL AND PUBLIC SAFETY 

State Highway Patrol. 53 PR 

Butner Public Safety Division, 419 PR 



ECONOMIC AND COMMUNITY DEVELOPMENT 

Banking Commission, 16 PR 
Community Assistance, 25 PR, 317 PR 
Credit Union, 317 PR 



Milk Commi 



ssion, 



24 P 



ENVIRONMENT, HEALTH, \ND NATURAL RESOURCES 

Coastal Management, 136 PR, 292 PR 
Environmental Management, 54 PR, 193 PR, 420 PR 
Health Services, 190 PR 
Marine Fisheries, 63 PR. 484 PR 

Wildlife Resources and Water Safety, 137 PR. 206 PR. 2 l )3 PR, 34 l ) PR, 43S PR 



5:7 NORTH CAROLINA REGISTER July 2, 1990 



5U 



CUMULATIVE INDEX 



FINAL DECISION LETTERS 

Voting Rights Act, 241, 2N6. 316 

FINAL RULES 

I ist of Rules Codified, 143 FR, 226 FR, 302 FR, 463 FR 

GOVERNOR/LT. GOVERNOR 

Executive Orders, 236, 313, 4(18, 474 

HUMAN RESOURCES 

Health Sen ices, 152 FR. 245 FR 

Medical Assistance, 101 PR 

Mental Health, Developmental Disabilities and Substance Abuse Services, 20 FR, 318 PR, 475 PR 

Services for the Blind, 412 PR 

Social Services, 247 PR 

Water Treatment Facilitv Operators Board of Certification, 27 PR 

Youth Services, 261 PR 

INSURANCE 

Actuarial Services Division, 4SD PR 
Agent Services Division, 321 PR 
Financial Evaluation Division, 342 PR 
Fire and Casualty Division. 335 PR. 478 PR 
Fife: Accident and Health, 264 PR. 2S7 PR 

JUSTICE 

Attorney General. Office of the. 102 PR, 273 PR 

LICENSING BOARDS 

Cosmetic Art Examiners. Board of, 355 PR 

Electrical Contractors, Board of Examiners of, 356 PR 

Medical Examiners, Board of. 207 PR 

Nursing, Board of, 300 PR, 406 PR 

Physical Therapy Examiners, Board of, 443 PR 

PUBLIC EDUCATION 

Elementary and Secondary, 141 PR, 275 PR, 351 PR 

REVENUE 

Individual Income Tax. 350 ER 

I icense and Excise Tax Division, 445 FR 

Sales and Fse Tax. 213 FR, 453 FR 

SECRETARY OF STATE 

Corporations Division. 489 PR 
Securities Divison. 203 PR, 4 l )5 PR 

STATE PERSONNEL 

State Personnel Commission. 277 PR, 500 PR 

STATE TREASURER 

Department Rules. 352 PR 

I ocal Government Commission, 352 PR. 442 PR 

Solid Waste Management Capital Projects Financing Agency, 354 PR 

TRANSPORTATION 

Motor Vehicles, Division of, 222 FR 



513 5:7 NORTH CAROLINA REGISTER July 2, 1990 



NORTH CAROLINA ADMINISTRATIVE CODE 

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